We did a QCD in 2009, just received notice we owe "doc stamp tax?" (mortgage, mortgages)

[dirtymartini]

We purchased a home in March, 2009. It was a 350k house. We put down 80k, so our mortgage is for 270k. We knew my husband's name was the only one on the mortgage, but we noticed my name was not on the deed. The woman from the title company told us that was no big deal, we just had to pay $10.70 and mail in a QCD to have that changed. We did, and I thought that was the end of it.

About a month ago, we refinanced to get a lower interest rate (3.75%) fixed 30 year. We did not take any money out or anything, we just wanted a lower payment. I guess that somehow alerted the folks in Tallahassee, because a week ago I received paperwork saying we owed a "document stamp tax." I spoke with the woman who is the tax auditor, she said she estimates our amount owed will be about $950. Is this true? Why weren't we told this by the mortgage broker or the title company? Is there anything we can do? I have a call in to the women we dealt with at the title company 3 years ago, waiting to hear from her.

Thanks for any info you can share!

[jackmichigan]

I'm not familiar with Florida transfer taxes, so I can't help you, but if you clarify which transaction they are claiming you owe money on perhaps someone else will be able to provide some information.

Is it based upon your original purchase for $350,000? Or did your Quit Claim Deed erroneously include a value above $1 which is causing the problem?

[399083453]

Documentary Stamp Tax Between Spouses in Florida

Adding a Wife To Title In Florida and the Documentary Stamp Tax.

A deed transferring an interest in Florida real property between a husband and wife, including when a spouce's name is added to a deed, is subject to documentary stamp tax. In most cases, the amount of tax is based on half of the amount of the unpaid balance of any mortgages. If the Property is unencumbered there is no Stamp Tax.

Call Your Clerk/Recorder of Deeds to Qualify the Tax Rate and if there are Exemptions.

[NY Annie]

Since the original deed is the one that needed to be corrected and is not simply an "adding spouse to the deed" situation, your title company should be able to clarify that with the Recorder of Deeds office and eliminate the need for the tax. You might be able to do that on your own with that office, but it would be far easier for the title company to inform that this is a correcting deed/change and not an adding spouse situation.

good luck.

[dirtymartini]

thanks for the responses! I checked the thread for a few days and did not think I was going to get any responses. Sorry it took me so long to check back.

Jack-It is based on the QCD, which was done 3 months after the actual sale.

399-when googling I found that also (even the misspelling of the word "spouce" lol) and that is what has me worried!!!

NYAnnie-yes, I am going to copy and paste the original sale, the QCD and then something the title company did just a few weeks ago to supposedly correct the situation. When I called the title company to inquire why I am getting this audit for doc stamp tax from 2009, they told me that the state is crazy, that is B.S. etc etc. She then told me to get the QCD to her and she would add another stamp to it that should take care of the situation. I faxed it up to Tallahassee, and I am still told "Nope, you owe the doc stamp tax!"

WHY ON EARTH should we pay the tax twice? Why would I have done that? When my DH noticed my name was not on the deed, he mentioned it to the mortgage broker who told him it was no big deal to get my name added on later. We were in a rush to close and I guess he didn't want to take the time to change the paperwork. Closed on 3-26-2009. So, a few months later when we mentioned it again, he said, "Oh yeah, no big deal, but the title company takes care of that. Call the woman we dealt with at closing and she will help you!"

I called her and she said, "Oh, sure, no biggie...it will be $10 plus a 70 cent tax." So we did it and that was that. That was 6-30-2009

Fast forward to a few months ago, we refinanced to a lower rate. Apparently it dredged up this transaction and we got an audit in the mail.

Here is the info for the original sale:
Document Type: (D) Deed Transfers of Real Property Record Date : 3/27/2009 3:30:01 PM Grantor: jones, john
Grantee: smith,bob
Book Type: O Book / Page: 46xxx / 12xx # of Pages: 1 Consideration: 350,000.00 Legal: Lot xxx
Parcel Id: xxxxx






Here is the QCD:
Document Type: (D) Deed Transfers of Real Property Record Date : 7/22/2009 10:11:19 AM Grantor: smith, bob
smith, sue
Grantee: smith, bob
smith, sue
Book Type: O Book / Page: 46xxx / 14xx # of Pages: 1 Consideration: 10.00 Legal: Lot xxx
Parcel Id: xxx


here is the "correction" done just a few weeks ago:

Document Type: (D) Deed Transfers of Real Property Record Date : 6/14/2012 2:00:33 PM Grantor: smith, bob
smith, sue
Grantee: smith, bob
smith, sue
Book Type: O Book / Page: 48xxx / 1xx # of Pages: 1 Consideration: 10.00 Legal: Lot xxx
Parcel Id: xxxx



why on the QCD does it show grantor and grantee as both or our names? Shouldn't it say grantor Bob Smith....then on the next line say grantee Bob Smith, Sue Smith? For some reason that give me a little hope.

also, here is the info on the actual page I don't know what "DRR-T" means:
Date Type Price Book Page 6/30/2009 QCD-T $100 14 6/14/2012 DRR-T $100 1 3/26/2009 WD-Q $350,000 12

Is the title company responsible for this? I hate these situations, the mortgage broker is a friend, and the woman at the title company is a neighbor. Thanks for any insight you can share!

[dirtymartini]

arggh, the stuff did not copy and paste in an orderly fashion. So sorry, hope it makes sense.

[dirtymartini]

here is a court case that I am hoping I can fall back on?

DEPARTMENT OF REVENUE v. RACE, No.

[TampaKaren]

This is the way it works in Florida and it could have been a lot worse. As it stands today, you are paying Doc Stamps (aka transfer taxes) on 1/2 of the $270K mortgage or $135K which is the benefit to you as the spouse. Doc Stamps are $7 per thousand so $135 x $7 = $945. Can you imagine what it would have been on the sales price of the house or the entire mortgage amount? The $10.70 was the cost to record the new deed with the Clerk's office.

Sorry you didn't know in advance. And no, there's no way around it after-the-fact. It surprises many.

[dirtymartini]

Hi Tampa Karen and thank you for your response!

Did you see my last post with the court case? Sounds very similar to mine, and they fought and won. Didn't we pay doc stamp tax on the original mortgage? Why should we pay half of it again just 3 months later?

Also, why did the title company tell me it would only be $10.70? I might have chosen not to do it had I known it would be more like $1000! When we noticed that my name was not on the deed BEFORE closing, we were told we probably should not delay the closing to fix it(there were a lot of "close calls" with this house, it was a short sale a few weeks away from foreclosure) so we would just "take care of it later."

I guess now I am leaning towards asking the title company to pay for it. I have been in touch with them and they are just as surprised as I am. They have been in business for over 20 years, not some fly by night company. Don't title companies have E&O insurance for things like this?

[dirtymartini]

I copied and pasted this from a link...check out #3. The title company made an error and did a "DRR" which is a correction.

12B-4.014 Conveyances Not Subject to Tax.
(1) Security for Debt: The reconveyance of realty conveyed to secure a debt upon payment of such debt is not taxable.
(2) No Consideration:
(a) A conveyance of unencumbered realty as a gift is not taxable.
(b) A deed of conveyance reciting a consideration such as “love and affection and $1”, “desire to promote welfare and $1”, or “$1 and other valuable consideration”, requires at least the minimum tax.
(3) To Correct Error: Where a conveyance is made to correct a deficiency in a previous deed on which the tax has been paid, only minimum tax is required. (1933 Op. Att’y. Gen. Fla. 1933-34 Biennial Report, Page 50 (April 7, 1933); Letter from the Att’y. Gen. Fla. to State Comptroller (Dec. 10, 1962))

This is the link...

https://www.flrules.org/gateway/RuleNo.asp?id=12B-4.014