What did the original Florida TAA 99B4-009 say about deed tax on property transferred in a partnership conversion?

Plain-English summary

The original ruling said only minimum documentary stamp tax applied to the conversion deeds, but the document expressly points to a later revised TAA. Its original analysis treated the converted limited partnership as the same entity as the general partnership that existed before conversion.

The original conclusion depended on full compliance with the statutory conversion requirements and on the general partnership holding fee-simple title immediately before conversion. Because the source directs readers to Revised TAA 99B4009R dated December 20, 1999, the original holding should not be treated as the Department's final position.

What this means for you

This page records the original advisement for historical completeness. Revised TAA 99B4009R must be reviewed before drawing a current or final conclusion about the transaction.

Common questions

Q: What did the original TAA conclude? Minimum deed tax, rather than tax based on fair market value, for a compliant conversion by the same partnership.

Q: What conditions did the original ruling state? Full statutory compliance and fee-simple ownership by the general partnership immediately before conversion.

Q: Can the original conclusion be relied on? No. The original document itself directs readers to revised TAA 99B4009R.

Citations and references

• Fla. Stat. § 201.02(1) — deed documentary stamp tax
• Fla. Stat. §§ 620.8902, 620.8904(2)(a) — partnership conversion and title
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 99B4-009

Original ruling text

SUMMARY

Question: Is a deed from a limited partnership to the
general partnership, for real property that was owned by
the general partnership prior to the conversion subject
only to the minimum tax and not taxed based on the fair
market value?

Answer - Based on Facts Below: A partnership converted
pursuant to s. 620.8902, F.S., is for all purposes the same
entity that existed before the conversion. When all
requirements for the conversion, set forth in s. 620.8902,
F.S., are complied with, only minimum tax under s. 201.02,
F.S., is due.

See Revised TAA 99B4009R dated December 20, 1999.

Jul 29, 1999

Re: Technical Assistance Advisement No. 99(B)4-009
Documentary Stamp Tax - Deed Pursuant to Partnership
Conversion
Section 201.02(1), F.S.
XXX (hereinafter Partnership)

Dear :

Your letter requesting a Technical Assistance Advisement
has been referred to this office for response. The specific
scenario for which advice has been requested is summarized
below.

FACTS AS PRESENTED BY PETITIONER

A general partnership was organized in 1954, and sometime
thereafter acquired title to certain real property in Florida.
In 1997, the partners of the partnership contributed their
proportionate interest in the partnership to a corporation in

exchange for XXX shares of stock in the corporation. The shares
of stock were distributed to the partners in accordance to their
proportionate interest in the partnership. The general
partnership was thereafter converted to a limited partnership
pursuant to s. 620.8902, F.S., with the corporation serving as
the sole general partner. The limited partnership agreement was
filed with the Department of State. All partners maintained
their respective partnership interests after the conversion.

REQUEST FOR ADVISEMENT

You request advisement that deed(s) from the limited
partnership to the general partnership, for real property that
was owned by the general partnership prior to conversion, will
be subject only to minimum tax, and will not be taxed based on
the fair market value.

PROVISIONS OF LAW

Section 201.02(1), F.S., imposes tax on deeds which convey
any interest in real property at the rate of 70 cents for each
$100 of the consideration given for the interest in the real
property conveyed. Consideration includes, but is not limited
to, the money paid or agreed to be paid; the discharge of an
obligation; and the amount of any mortgage, purchase money
mortgage lien, or other encumbrance, whether or not the
underlying indebtedness is assumed. When consideration for the
real property interest includes property other than money, it is
presumed that the consideration is equal to the fair market
value of the real property interest.

A partnership that has been converted pursuant to the
provisions of s. 620.8902, F.S., is for all purposes the same
entity that existed before the conversion. The statute further
provides in paragraph 620.8904(2)(a), F.S., that when a
conversion takes effect, title to all real property owned by the
converting partnership shall be transferred by deed to the
converted entity.

POSITION OF THE DEPARTMENT

When a partnership is converted pursuant to s. 620.8902,
F.S., the converted partnership is the same entity that already
existed before the conversion. Based on the law and facts
presented, it is the position of the Department that only
minimum documentary stamp tax, under s. 201.02, F.S., is due on
the deeds from the general partnership to the limited
partnership. This only applies, however, if all of the
requirements for conversion, set forth in
s. 620.8902, F.S., are complied with. Furthermore, it only
applies if the general partnership held fee simple title to the
real property immediately before the conversion to a limited
partnership.

This response constitutes a Technical Assistance Advisement
under s. 213.22, F.S., which is binding on the Department only
under the facts and circumstances described in the request for
this advice as specified in s. 213.22, F.S. Our response is
predicated on those facts and the specific situation summarized
above. You are advised that subsequent statutory or
administrative rule changes or judicial interpretations of the
statutes or rules upon which this advice is based may subject
similar future transactions to a different treatment than
expressed in this response.

You are further advised that this response, your request
and related backup documents are public records under Chapter
119, F.S., and are subject to disclosure to the public under the
conditions of s. 213.22, F.S. Confidential information must be
deleted before public disclosure. In an effort to protect
confidentiality, we request you provide the undersigned with an
edited copy of your request for Technical Assistance Advisement,
the backup material and this response, deleting names, addresses
and any other details which might lead to identification of the
taxpayer. Your response should be received by the Department
within 15 days of the date of this letter.

Sincerely,

Celestine Grantham
Senior Tax Specialist
Technical Assistance and Dispute Resolution

Office of General Counsel

CG/mh