Opinion No. (1999)

BILL LOCKYER Attorney General Gregory L. Gonot, Deputy THE HONORABLE WESLEY CHESBRO, MEMBER OF THE CALIFORNIA STATE SENATE, has requested an opinion on the following question: Does the documentary transfer tax apply to the transfer of real property from a parent corporation to a wholly-owned subsidiary corporation? CONCLUSION The documentary transfer tax does not apply to the transfer of real property from a parent corporation to a wholly-owned subsidiary corporation when the beneficial ownership of the property remains the same. ANALYSIS The Documentary Transfer Tax Act (Rev. Tax. Code, §§ 11901 - 11934 ; "Act") 1 authorizes cities and counties to impose a tax upon the documents by which real property interests are conveyed. Section 11911 provides: "(a) The board of supervisors of any county or city and county, by an ordinance adopted pursuant to this part, may impose, on each deed, instrument, or writing by which any lands, tenements, or other realty sold within the county shall be granted, assigned, transferred, or otherwise conveyed to. or vested in, the purchaser or purchasers, or any other person or persons, by his or their direction, when the consideration or…