# Tax - Property (GTP)

## Title 13. Transfer Taxes

### Subtitle 1. Definitions; General Provisions

#### Section 13-101

(a) In this title the following words have the meanings indicated.

(b) "Articles of consolidation" means a document filed with the Department under Sec. 3-107 of the Corporations and Associations Article which evidences a consolidation of at least one Maryland corporation with another corporation to form a new Maryland corporation.

(c) "Articles of merger" means a document filed with the Department under Sec. 3-107, Sec. 4A-703, Sec. 9A-903, or Sec. 10-208 of the Corporations and Associations Article which evidences a merger involving at least one Maryland corporation, Maryland limited liability company, Maryland partnership, or Maryland limited partnership.

(d) "Documents which evidence the merger or consolidation of foreign corporations, foreign partnerships, foreign limited liability companies, or foreign limited partnerships" means those documents that are filed or recorded with:

  (1) the Department under Sec. 3-117, Sec. 4A-1012, Sec. 9A-910, or Sec. 10-912 of the Corporations and Associations Article; or

  (2) the clerk of the circuit court of a county evidencing that title to real property has been conveyed through a merger or consolidation of 2 or more foreign corporations, foreign partnerships, foreign limited liability companies, or foreign limited partnerships.

(e)

  (1) "Instrument of writing" means a written instrument that conveys title to, or a leasehold interest in, real property.

  (2) "Instrument of writing" includes:

    (i) a deed or contract;

    (ii) a lease;

    (iii) an assignment of a lessee's interest;

    (iv) articles of merger or other document which evidences a merger of foreign corporations, foreign limited liability companies, foreign partnerships, or foreign limited partnerships; and

    (v) articles of consolidation or other document which evidences a consolidation of foreign corporations.

  (3) "Instrument of writing" does not include:

    (i) a mortgage, deed of trust, or other contract that creates an encumbrance on real property; or

    (ii) a security agreement, as defined in Sec. 12-101(l) of this article.

(f) "Subsidiary corporation" includes any corporation that is a subsidiary of either a parent corporation or any other subsidiary corporation of the parent corporation.

(g) "Successor" has the meaning stated in Sec. 1-101(dd) of the Corporations and Associations Article.

#### Section 13-102

By agreement, a transfer tax under this title may be paid by any person.

#### Section 13-103

(a) In this section, "controlling interest", "real property", and "real property entity" have the meanings stated in Sec. 12-117 of this article.

(b)

  (1) The taxes under this title are imposed on the transfer of a controlling interest in a real property entity as if the real property, directly or beneficially owned by the real property entity, was conveyed by an instrument of writing that is recorded with the clerk of the circuit court for a county or filed with the Department under Sec. 13-202 of this title.

  (2) The taxes under this section are imposed on the consideration payable for the transfer of the controlling interest in the real property entity or on the value of the real property directly or beneficially owned by the real property entity, as provided in Sec. 12-117(b)(2) of this article.

  (3)

    (i) Except for the county transfer tax, the taxes under this section shall be applied at the rates established in this title.

    (ii) The county transfer tax shall be applied at the rate imposed by the county where the real property is located.

(c) The taxes under this title are not imposed on the transfer of a controlling interest in a real property entity in any of the circumstances described:

  (1) in Sec. 13-207 of this title that exempts an instrument of writing from the transfer tax; or

  (2) in Sec. 12-117(c) of this article that exempts the transfer of a controlling interest in a real property entity from the recordation tax.

(d) In each instance in which a controlling interest in a real property entity is transferred, the provisions of Sec. 12-117(d) and (e) of this article are applicable.

(e) This section does not apply in the circumstances described in Sec. 12-117(f) of this article.

(f) The Department shall adopt regulations to administer this section in the same manner as in Sec. 12-117(g) of this article.

### Subtitle 2. State Tax -- in General

#### Section 13-201

In this subtitle, "transfer tax" means the tax imposed under this subtitle.

#### Section 13-202

Except as otherwise provided in this subtitle, a transfer tax is imposed on an instrument of writing:

(1) recorded with the clerk of the circuit court for a county; or

(2) filed with the Department and described in Sec. 12-103(d) of this article.

#### Section 13-203

(a)

  (1) Except as provided in subsections (a-1) and (b) of this section, the rate of the transfer tax is 0.5% of the consideration payable for the instrument of writing.

  (2) The consideration:

    (i) includes the amount of any mortgage or deed of trust assumed by the grantee; and

    (ii) subject to item (i) of this paragraph, includes only the amount paid or delivered in return for the sale of the property and does not include the amount of any debt forgiven or no longer secured by a mortgage or deed of trust on the property.

(a-1)

  (1) Except as provided in subsection (b) of this section, the rate of the transfer tax is 0.5% of the consideration paid for the transfer of a controlling interest in a real property entity as defined in Sec. 13-103 of this title that has developed real property under Section 42 of the Internal Revenue Code, the Low Income Housing Tax Credit Program.

  (2) The consideration under this subsection shall be the actual payment made by the purchaser to the seller for the purchase of the interest.

(b)

  (1) In this subsection, "first-time Maryland home buyer" means an individual who has never owned in the State residential real property that has been the individual's principal residence.

  (2) If there are two or more grantees, this subsection does not apply unless each grantee is a first-time Maryland home buyer or a co-maker or guarantor of a purchase money mortgage or purchase money deed of trust as defined in Sec. 12-108(i) of this article for the property and the co-maker or guarantor will not occupy the residence as the co-maker's or guarantor's principal residence.

  (3) Notwithstanding any other provision of law, for a sale of improved residential real property to a first-time Maryland home buyer who will occupy the property as a principal residence, the rate of the transfer tax is 0.25% of the consideration payable for the instrument of writing and the transfer tax shall be paid entirely by the seller.

  (4) To qualify for the exemption under paragraph (3) of this subsection, each grantee or an agent of the grantee shall provide a statement that is signed under oath by the grantee or agent of the grantee stating that:

    (i)

      (1) the grantee is an individual who has never owned in the State residential real property that has been the individual's principal residence; and

      (2) the residence will be occupied by the grantee as the grantee's principal residence; or

    (ii)

      (1) the grantee is a co-maker or guarantor of a purchase money mortgage or purchase money deed of trust as defined in Sec. 12-108(i) of this article for the property; and

      (2) the grantee will not occupy the residence as the co-maker's or guarantor's principal residence.

  (5) A statement under paragraph (4) of this subsection by an agent of a grantee shall state that the statement:

    (i) is based on a diligent inquiry made by the agent with respect to the facts set forth in the statement; and

    (ii) is true to the best of the knowledge, information, and belief of the agent.

#### Section 13-204

The consideration payable shall be described in:

(1) the recitals or the acknowledgment of the instrument of writing; or

(2) a statement under oath that accompanies the instrument of writing and that is signed by a party to the instrument or by an agent of a party.

#### Section 13-205

(a) If a lease of real property creating a perpetually renewable ground rent is recorded without a transfer of the reversionary estate for full consideration other than the ground rent being recorded at the same time, the transfer tax applies to the redemption sum as determined under Sec. 8-804 of the Real Property Article plus any additional consideration payable. If the lease is recorded at the same time with the transfer of the reversionary estate created for full consideration, the lease is not subject to transfer tax.

(b) Except as provided in Sec. 13-207(a)(14) of this subtitle, for a lease of real property for a term of years not perpetually renewable, the transfer tax applies to:

  (1) the average annual rent over the term of the lease, including renewals, capitalized at 10% plus any additional consideration payable, other than rent; or

  (2) if the average annual rent cannot be determined, the greater of:

    (i) 105% of the minimum average annual rent, as determined by the lease, capitalized at 10%, plus any additional consideration payable, other than rent; or

    (ii) 60% of the assessment of the real property subject to lease.

(c)

  (1) In this subsection, "document":

    (i) means any document that publicizes or gives constructive notice of an unrecorded lease; and

    (ii) includes:

      (1) an attornment agreement;

      (2) a memorandum of a lease; and

      (3) an assignment of a lease.

  (2) A document may be recorded only if the original lease is submitted and transfer tax on the document and the original lease is paid.

  (3) Subject to Sec. 13-102 of this title, the lessee is chargeable with transfer tax on the original lease. If a lessee fails or refuses to pay transfer tax after a demand is made, the party offering the original lease for recordation may:

    (i) pay the recordation tax; and

    (ii) sue the lessee to recover the amount of transfer tax paid, with interest from the date of payment of transfer tax.

  (4) Transfer tax shall be paid on the original lease only if the original lease was required to be recorded under Sec. 3-101 of the Real Property Article.

(d)

  (1) For a transfer under Sec. 13-206 of this subtitle, the transfer tax applies to the value of the real property determined by the Department at the date of finality immediately before the date of transfer.

  (2) For a transfer by articles of merger, articles of consolidation, or other documents which evidence a merger or consolidation of foreign corporations, foreign partnerships, foreign limited liability companies, or foreign limited partnerships, the transfer tax applies to the value of the real property determined by the Department at the date of finality immediately before the date of the merger or consolidation.

#### Section 13-206

Except as provided in Sec. 13-207(a)(9), (10), (15), and (16) of this subtitle, the transfer tax applies to conveyances that transfer the real property of a corporation to its stockholders, the real property of a limited liability company to its members, or the real property of a partnership to its partners.

#### Section 13-207

(a) An instrument of writing is not subject to transfer tax to the same extent that it is not subject to recordation tax under:

  (1) Sec. 12-108(a) of this article (Transfer to government or public agency);

  (2) Sec. 12-108(c) of this article (Transfer between relatives and domestic partners);

  (3) Sec. 12-108(d) of this article (Transfer between spouses and domestic partners);

  (4) Sec. 12-108(e) of this article (Supplemental instrument);

  (5) Sec. 12-108(f) of this article (Previously recorded instrument);

  (6) Sec. 12-108(l) of this article (Judgments);

  (7) Sec. 12-108(n) of this article (Order of satisfaction);

  (8) Sec. 12-108(o) of this article (Participation agreement);

  (9) Sec. 12-108(p) of this article (Transfer of property between related business entities);

  (10) Sec. 12-108(q) of this article (Corporate or partnership conveyance);

  (11) Sec. 12-108(r) of this article (Land installment contracts);

  (12) Sec. 12-108(s) of this article (Options to purchase real property);

  (13) Sec. 12-108(t) of this article (Deed for prior contract of sale);

  (14) Sec. 12-108(u) of this article (Leases of 7 years or less);

  (15) Sec. 12-108(v) of this article (Mergers);

  (16) Sec. 12-108(w) of this article (Consolidations);

  (17) Sec. 12-108(x) of this article (Cooperative housing corporations);

  (18) Sec. 12-108(y) or (bb) of this article (Transfer from predecessor entity or real estate enterprise to limited liability company);

  (19) Sec. 12-108(z) of this article (Transfer from a Class I Railroad Carrier to its wholly owned limited liability company);

  (20) Sec. 12-108(aa) of this article (Transfers involving certain Maryland Stadium Authority affiliates);

  (21) Sec. 12-108(cc) of this article (Certain transfers to land trusts);

  (22) Sec. 12-108(dd) of this article (Transfer from an estate);

  (23) Sec. 12-108(ee) of this article (Transfer to a trust and transfer from a trust under specified circumstances);

  (24) Sec. 12-108(ff) of this article (Transfer from a certified community development financial institution);

  (25) Sec. 12-108(gg) of this article (Transfer of principal residence surrendered in bankruptcy);

  (26) Sec. 12-108(hh) of this article (Transfer of real property within the Pimlico racing facility site, Pimlico site, Bowie Race Course Training Center property, or training facility site); or

  (27) Sec. 12-108(ii) of this article (Real property transfer-on-death deed).

(b)

  (1) An instrument of writing that transfers agricultural land that the transferee is acquiring for the purpose of maintaining the character of the land as agricultural land is not subject to the transfer tax, if the transferee:

    (i) is exempt from federal income tax under Sec. 501(c)(3) of the Internal Revenue Code;

    (ii) is incorporated, qualified, or registered to do business in the State;

    (iii) has as its principal purpose the preservation of agricultural land, including the temporary ownership of an interest in land for the purpose of preserving the character of the land as agricultural land; and

    (iv) has been certified by the Department as meeting the requirements of this paragraph.

  (2) If a transferee notifies the Department at least 7 days before the date of transfer of property to the transferee, the Department shall notify, in writing, the clerk of the circuit court for the county in which the property being transferred is located of the name and address of each transferee that has been certified under paragraph (1) of this subsection.

(c) An instrument of writing is not subject to the transfer tax, if the instrument of writing transfers property from:

  (1) the United States;

  (2) the State;

  (3) an agency of the State; or

  (4) a political subdivision in the State.

#### Section 13-208

(a) Transfer tax on an instrument of writing that is taxable under this subtitle shall be paid to the clerk of the circuit court where the instrument of writing is recorded or to the Department.

(b) An instrument of writing taxable under this subtitle may not be recorded in any county unless a statement is attached to or stamped on the instrument of writing that indicates:

  (1) that transfer tax has been paid; and

  (2) the amount of transfer tax paid.

(c) The presence of the statement required by subsection (b) of this section on an instrument of writing is prima facie evidence of payment of transfer tax.

#### Section 13-209

(a)

  (1) Before any other distribution under this section, in any fiscal year that bonds secured by a pledge of the State transfer tax are outstanding, the revenue from the transfer tax shall be used to pay, as and when due, the principal of and interest on the bonds.

  (2) The Department shall deduct the cost of administering the transfer tax from the taxes collected under this title and credit those revenues to the fund established under Sec. 1-203.3 of the Corporations and Associations Article.

  (3) Except as provided in paragraph (4) of this subsection, after deducting the revenues required under paragraphs (1) and (2) of this subsection, the revenue from transfer tax is payable to the Comptroller for deposit in a special fund.

  (4) In any fiscal year in which transfer tax revenue is used to pay debt service on outstanding bonds under paragraph (1) of this subsection, the distribution of revenues in the special fund under this section and as specified in Sec. 5-903(a)(2)(i)1A of the Natural Resources Article, for State land acquisition, or to the Agricultural Land Preservation Fund to the extent any debt service is attributable to that Fund, shall be reduced by an amount equal to the debt service for the fiscal year.

(b) For the fiscal year beginning July 1, 2002, and for subsequent fiscal years, up to 3% of the revenues in the special fund may be appropriated in the State budget for salaries and related expenses in the Departments of General Services and Natural Resources and in the Department of Planning necessary to administer Title 5, Subtitle 9 of the Natural Resources Article (Program Open Space).

(c)

  (1) Subject to subsection (e) of this section, of the balance of the revenue in the special fund, not required under subsection (b) of this section:

    (i) for the fiscal year beginning July 1, 2002, $47,268,585 shall be allocated to the General Fund of the State and the remainder shall be allocated as provided in subsection (d) of this section;

    (ii) for the fiscal year beginning July 1, 2003, $102,833,869 shall be allocated to the General Fund of the State and the remainder shall be allocated as provided in the State budget;

    (iii) for the fiscal year beginning July 1, 2004, $147,374,444 shall be allocated to the General Fund of the State, and the remainder shall be allocated as provided in the State budget; and

    (iv) for the fiscal year beginning July 1, 2005, $68,223,132 shall be allocated to the General Fund of the State and the remainder shall be allocated as provided in subsection (d) of this section.

  (2) Subject to subsection (e) of this section, for the fiscal years beginning July 1, 2006, and each subsequent fiscal year, the balance of the revenue in the special fund, not required under subsection (b) of this section shall be allocated as provided in subsection (d) of this section.

  (3)

    (i) Subject to subsection (e) of this section, for fiscal years 2026 through 2029, of the balance of the revenue in the special fund not required under subsection (b) of this section, $25,000,000 shall be allocated to the General Fund of the State and the remainder shall be allocated as provided in subsection (d) of this section.

    (ii) For each of fiscal years 2026 through 2029, the allocation required under subparagraph (i) of this paragraph shall reduce the amount allocated for Program Open Space land acquisition purposes identified in subsection (d)(1)(ii) of this section and Sec. 5-903(a)(2)(i)1A of the Natural Resources Article, the Agricultural Land Preservation Fund identified in subsection (d)(2) of this section, and the Rural Legacy Program identified in subsection (d)(3) of this section and Sec. 5-903(a)(2)(iii) of the Natural Resources Article by an amount that is proportional to the amount of revenue each program is estimated to receive for the fiscal year.

(d) Subject to subsections (d-1) and (e) of this section, for the fiscal year beginning July 1, 2002, and for each subsequent fiscal year, the balance of the revenue in the special fund, not required under subsection (b) of this section and not allocated to the General Fund under subsection (c)(1) and (3) of this section shall be allocated in the State budget as follows:

  (1)

    (i)

      (75) 15% for the purposes specified in Title 5, Subtitle 9 of the Natural Resources Article (Program Open Space); and

    (ii) an additional 1% for Program Open Space, for land acquisition purposes as specified in Sec. 5-903(a)(2) of the Natural Resources Article;

  (2)

    (17) 05% for the Agricultural Land Preservation Fund established under Sec. 2-505 of the Agriculture Article;

  (3) 5% for the Rural Legacy Program established under Sec. 5-9A-01 of the Natural Resources Article; and

  (4)

    (1) 8% for the Heritage Conservation Fund established under Sec. 5-1501 of the Natural Resources Article.

(d-1)

  (1) In this subsection, "eligible purpose" means a purpose, program, or fund to which revenue in the special fund is required to be allocated under subsection (d) of this section.

  (2) For any fiscal year beginning on or after July 1, 2010, but before July 1, 2013, for which funding is provided for an eligible purpose through the State Consolidated Capital Bond Funding Program or other bond enabling act:

    (i) from the balance of the special fund, before the allocations under subsection (d) of this section are made, an amount shall be allocated to the General Fund of the State equal to the total amount of funding provided for eligible purposes through the bond enabling act; and

    (ii) except as otherwise expressly provided under the bond enabling act through which the funding is provided, the allocations provided under subsection (d) of this section shall be adjusted to reduce the amount that would otherwise be allocated for each eligible purpose by the amount of funding provided for that purpose under the bond enabling act.

  (3) Notwithstanding any other provision of law, a transfer under this subsection may not be taken into account for purposes of determining any allocation or appropriation required under subsection (f) or (g) of this section.

(e) The sums allocated in subsection (d) of this section may not revert to the General Fund of the State.

(f)

  (1)

    (i) Except as provided in subparagraphs (ii) and (iii) of this paragraph, for any fiscal year in which the actual transfer tax revenue collections are greater than the revenue estimates used as the basis for the appropriations required under this section for the fiscal year, the amount of the excess shall be allocated to the special fund under subsection (a) of this section as provided under subsections (c) and (d) of this section for the second fiscal year following the fiscal year in which there is an excess.

    (ii) Notwithstanding subparagraph (i) of this paragraph or any other provision of law, $21,776,868 of the transfer tax collected but not appropriated or transferred in fiscal 2004 shall be transferred to the General Fund of the State.

    (iii) Notwithstanding subparagraph (i) of this paragraph or any other provision of law, in any fiscal year in which an appropriation or transfer is made from the special fund to the General Fund, if the actual transfer tax revenue collections for the prior fiscal year exceed the budget estimate for the prior fiscal year, the excess shall be allocated in the current fiscal year for Program Open Space, the Agricultural Land Preservation Fund, the Rural Legacy Program, and the Heritage Conservation Fund. Funds made available under this subparagraph shall be allocated as provided under subsection (d) of this section.

  (2) For any fiscal year in which the actual transfer tax revenue collections are less than the revenue estimates used as the basis for the appropriations required under this section, the amount of the deficiency shall be reconciled as follows:

    (i) for the first $3,000,000 of any deficiency, the allocation to the special fund under subsection (a) of this section as provided under subsections (c) and (d) of this section for the second fiscal year following the deficiency shall be reduced by either the amount of the deficiency or $3,000,000, whichever is less;

    (ii) for any deficiency in excess of $3,000,000, the amount in excess of $3,000,000 shall be reconciled either by the reduction of the allocation to the special fund under subsection (a) of this section as provided under subsections (c) and (d) of this section for the second fiscal year following the deficiency or by the deauthorization of projects authorized in prior fiscal years;

    (iii) for the allocation of the special fund under subsection (a) of this section, in the fiscal year beginning July 1, 2016, transfer tax revenue under-attainment from the fiscal year beginning July 1, 2014, will not be applied; and

    (iv) transfer tax revenue in fiscal year 2015, that is in excess of $161,016,000 may be transferred by budget amendment in fiscal year 2016 for:

      (1) administrative expenses related to land acquisition for Program Open Space;

      (2) critical maintenance projects in the Department of Natural Resources;

      (3) Natural Resources Development Fund projects in the Department of Natural Resources; and

      (4) replacement of General Fund appropriations in the Maryland Park Service.

  (3)

    (i) Any amounts to be deauthorized from prior fiscal years under paragraph (2)(ii) of this subsection shall be proposed by the Governor in the budget of the second fiscal year following the fiscal year in which there is a deficiency.

    (ii) An amount may be deauthorized under this paragraph only as provided in the State budget bill, as enacted.

(g)

  (1)

    (i) The Governor shall include in the annual budget bill for fiscal year 2023 a General Fund appropriation to the special fund in the amount of $12,500,000.

    (ii) The appropriation required under subparagraph (i) of this paragraph:

      (1) is not subject to the provisions of subsections (a), (b), (c), and (f) of this section;

      (2) shall be allocated as provided in subsection (d) of this section and Sec. 5-903 of the Natural Resources Article; and

      (3) shall be reduced by the amount of any appropriation from the General Fund to the special fund that:

      (A) exceeds the required appropriation under this paragraph; and

      (B) is identified as an appropriation for reimbursement under this paragraph.

  (2)

    (i) The Governor shall include in the annual budget bill for fiscal year 2023 a General Fund appropriation to the special fund in the amount of $6,000,000 for park development and the critical maintenance of State projects located on lands managed by the Department of Natural Resources for public purposes.

    (ii) The appropriation required under subparagraph (i) of this paragraph:

      (1) is not subject to the provisions of subsections (a), (b), (c), and (f) of this section; and

      (2) shall be reduced by the amount of any appropriation from the General Fund to the special fund that:

      (A) exceeds the required appropriation under this paragraph;

      (B) is identified as an appropriation for reimbursement under this paragraph; and

      (C) supplements rather than supplants the Department of Natural Resources funding for the critical maintenance of State projects on State lands, based on the average critical maintenance budget of the 10 years preceding the appropriation.

  (3)

    (i)

      (1) For fiscal year 2023, the Governor shall include in the annual budget bill a General Fund appropriation in the amount of $2,500,000 to the Maryland Agricultural and Resource-Based Industry Development Corporation for the Next Generation Farmland Acquisition Program authorized under Sec. 10-523(a)(3)(ii) of the Economic Development Article.

      (2) For fiscal year 2025 only, the Governor shall include in the annual budget bill a General Fund appropriation in the amount of $2,735,000 to the Maryland Agricultural and Resource-Based Industry Development Corporation established under Title 10, Subtitle 5 of the Economic Development Article to be used as follows:

      (A) $2,300,000 to support the Corporation's rural business loan programs and small matching grant programs; and

      (B) $435,000 for grants and near-equity investments to:

      (I) support the creation or expansion of agricultural product aggregation and storage sites; and

      II.    facilitate participation in the Certified Local Farm and Fish Program.

      (3)

        (A) For each of fiscal years 2024, 2025, and 2026, the Governor shall include in the annual budget bill a General Fund appropriation of $500,000 to the Urban Agriculture Water and Power Infrastructure Grant Fund established under Sec. 2-2103 of the Agriculture Article.

      (B) For fiscal year 2027, the Governor shall include in the annual budget bill a General Fund appropriation of $400,000 to the Urban Agriculture Water and Power Infrastructure Grant Fund established under Sec. 2-2103 of the Agriculture Article.

    (ii) The appropriations required under subparagraph (i) of this paragraph:

      (1) are not subject to the provisions of subsections (a), (b), (c), and (f) of this section;

      (2) shall be allocated as provided in subsection (d) of this section and Sec. 5-903 of the Natural Resources Article; and

      (3) shall be reduced by the amount of any appropriation from the General Fund to the special fund that:

      (A) exceeds the required appropriation under this paragraph; and

      (B) is identified as an appropriation for reimbursement under this paragraph.

(h)

  (1) Except as provided in paragraph (3) of this subsection, if an appropriation or a transfer from the special fund to the General Fund occurs after the fiscal year ending June 30, 2018, the Governor shall include in the annual budget bills for each of the 3 successive fiscal years following the fiscal year in which a transfer is made a General Fund appropriation to the special fund equal to one-third of the cumulative amount of the appropriation or transfer from the special fund to the General Fund for the applicable fiscal year.

  (2) The appropriation required under paragraph (1) of this subsection:

    (i) represents reimbursement for the cumulative amount of any appropriation or transfer from the special fund to the General Fund for the applicable fiscal year;

    (ii) is not subject to the provisions of subsections (a), (b), (c), and (f) of this section;

    (iii) shall be allocated as provided in subsection (d) of this section and Sec. 5-903 of the Natural Resources Article;

    (iv) shall be made until the cumulative total appropriated under paragraph (1) of this subsection is equal to the cumulative amount of any appropriation or transfer from the special fund to the General Fund for the applicable fiscal year; and

    (v) shall be reduced by the amount of any appropriation from the General Fund to the special fund that:

      (1) exceeds the required appropriation under this subsection; and

      (2) is identified as an appropriation for reimbursement under this subsection.

  (3) The appropriation required under paragraph (1) of this subsection does not apply to transfers from the special fund to the General Fund that occur in fiscal years 2026 through 2029.

(i)

  (1) The distributions required under this subsection may not be utilized or considered for the purposes of calculating any allocation or appropriation under subsection (f) or (g) of this section.

  (2) Notwithstanding any other provision of law, the Governor may transfer funds from the special fund established under this section to the General Fund as follows:

    (i) on or before June 30, 2014, $89,198,555;

    (ii) for the fiscal year beginning July 1, 2014, $144,188,544;

    (iii) for the fiscal year beginning July 1, 2015, $115,366,700;

    (iv) for the fiscal year beginning July 1, 2016, $62,771,000; and

    (v) for the fiscal year beginning July 1, 2017, $46,028,000.

### Subtitle 3. Agricultural Land Transfer Tax

#### Section 13-301

(a) In this subtitle the following words have the meanings indicated.

(b) "Agricultural land" means real property that is or was assessed on the basis of farm or agricultural use under Sec. 8-209 of this article.

(c)

  (1) "Agricultural land transfer tax" means the tax imposed under Sec. 13-302 of this subtitle.

  (2) "Agricultural land transfer tax" does not include the surcharge imposed under Sec. 13-303(d) of this subtitle.

(d)

  (1) "Total value" means the value of the property as stated in the most recent assessment roll.

  (2) "Total value" includes any adjustment in the value of improvements that result from an increase in construction costs as determined by the Department as of the most recent date of finality.

#### Section 13-302

(a) Except as otherwise provided in Sec. 13-305 of this subtitle, agricultural land transfer tax is imposed on an instrument of writing that transfers title to agricultural land.

(b) Agricultural land transfer tax is payable in addition to any other transfer tax imposed under this title.

(c) An instrument of writing subject to agricultural land transfer tax may not be recorded in any county until the agricultural land transfer tax is paid to the collector for the county or paid to the Department.

(d) An instrument of writing subject to agricultural land transfer tax may not be filed with the Department until the agricultural land transfer tax is paid to the Department or the collector for the county.

#### Section 13-303

(a) The agricultural land transfer tax applies at the following rates:

  (1) for a transfer of 20 acres or more of agricultural land, 5%;

  (2) except as provided in item (3) of this subsection, for a transfer of less than 20 acres of agricultural land assessed for agricultural use or as unimproved agricultural land, 4%; or

  (3) for a transfer of less than 20 acres of agricultural land assessed as improved agricultural land or agricultural land with site improvements, 3%.

(b) If an instrument of writing is subject to different rates of agricultural land transfer tax under subsection (a) of this section, the total agricultural land transfer tax due is computed separately for each portion of agricultural land to which a different rate applies.

(c) Except as provided by Sec. 13-305(b)(2) or (c)(4) of this subtitle, the agricultural land transfer tax determined under subsection (a) or subsection (b) of this section is reduced by:

  (1) 25% if property tax on the agricultural land was paid on the basis of any assessment other than the farm or agricultural use assessment under Sec. 8-209 of this article for 1 full taxable year before a transfer;

  (2) 50% if property tax on the agricultural land was paid on the basis of any assessment other than the farm or agricultural use assessment under Sec. 8-209 of this article for 2 full consecutive taxable years before a transfer; and

  (3) 65% if property tax on the agricultural land was paid on the basis of any assessment other than the farm or agricultural use assessment under Sec. 8-209 of this article for 3 or more full consecutive taxable years before a transfer.

(d)

  (1) Except as provided in paragraph (2) of this subsection, in addition to the agricultural land transfer tax, a surcharge in an amount equal to 25% of the tax determined under subsections (a) through (c) of this section is imposed on an instrument of writing that transfers title to agricultural land.

  (2) The surcharge imposed under paragraph (1) of this subsection does not apply to an instrument of writing that transfers property of 2 acres or less to be improved to a child or grandchild of the owner.

(e) When determining the rate of the agricultural land transfer tax to be imposed under subsection (a) or (b) of this section, the amount of agricultural land transferred that is exempt from the tax in accordance with Sec. 13-305 of this subtitle may not be included in the amount of agricultural land that is transferred.

#### Section 13-304

(a) The agricultural land transfer tax is imposed on the consideration payable for the instrument of writing less:

  (1) the total value of any improvements on the property; and

  (2) the total value of any land not subject to the agricultural land transfer tax.

(b)

  (1) If an instrument of writing transfers agricultural land with an improvement that has not been assessed by the supervisor, the grantor shall notify the supervisor at least 7 days before the date of transfer.

  (2) For the purposes of paragraph (1) of this subsection, the supervisor shall:

    (i) determine the estimated total value of the improvements on the most recent date of finality; and

    (ii) give the grantor at the time of the transfer a notice of the estimated value of the improvements.

  (3) The grantor may appeal the estimated total value stated in the notice as provided by Sec. 8-407 of this article.

#### Section 13-305

(a) If the amount of agricultural land transferred is not greater than the applicable residential minimum zoning size in effect at the time of transfer, an instrument of writing for the residential use of the owner of the agricultural land or the owner's immediate family is not subject to the agricultural land transfer tax.

(b)

  (1) Except as provided in paragraph (2) of this subsection, an instrument of writing that transfers title to agricultural land that is eligible for farm or agricultural use assessment under Sec. 8-209 of this article is not subject to the agricultural land transfer tax if the transferee:

    (i) files with the supervisor before the transfer a declaration of intent to farm the agricultural land that specifies that all of the transferred agricultural land will remain in farm or agricultural use for at least 5 full consecutive taxable years; and

    (ii) applies for farm or agricultural use assessment under Sec. 8-209 of this article for the land that is transferred.

  (2)

    (i) If there is a failure to comply with a declaration of intent filed under paragraph (1) of this subsection including the building of nonagricultural improvements or nonagricultural site improvements or there is a failure to qualify for the farm or agricultural use assessment under Sec. 8-209 of this article during the time that a declaration of intent is in effect, the agricultural land transfer tax, plus penalty, is due on that portion of the land that fails to comply with the declaration of intent or to qualify for farm or agricultural use.

    (ii) The tax and penalty due under this subsection are a lien on the agricultural land that was transferred. The tax and penalty are due on the earlier of:

      (1) the next date on which property tax on the agricultural land is due under Sec. 10-102 of this article; or

      (2) the date of the next transfer of any part of the agricultural land.

  (3) For the purpose of paragraph (2) of this subsection, the supervisor shall calculate the amount of the agricultural land transfer tax due by:

    (i) determining the fair market value of the land subject to the tax as of the most recent July 1 and providing the property owner with a notice of that value, which the property owner may appeal as provided by Sec. 8-404 of this article;

    (ii) multiplying the fair market value of the land subject to the tax by the rate of tax provided under Sec. 13-303 of this subtitle; and

    (iii) adding to the tax calculated under subparagraph (ii) of this paragraph a penalty in the amount of 10% of the tax due.

(c)

  (1) An instrument of writing that transfers title to agricultural land that is eligible for farm or agricultural use assessment or that received the agricultural use assessment as of the most recent July 1 under Sec. 8-209 of this article is subject to the agricultural land transfer tax as provided in paragraph (2) of this subsection, if the transferee:

    (i) files with the supervisor before the transfer a declaration of intent to farm the land that specifies that part of the agricultural land will remain in farm or agricultural use for at least 5 full consecutive taxable years;

    (ii) for a parcel that can be further subdivided into 2 or more parcels, provides the supervisor with a survey that accurately identifies the location of the land and the amount of acreage that is subject to the declaration of intent; and

    (iii) applies for farm or agricultural use assessment for part of the agricultural land that is transferred.

  (2) The agricultural land transfer tax applies to the value of the land not subject to the declaration of intent, exclusive of the items stated in Sec. 13-304 of this subtitle.

  (3) For the purpose of paragraph (2) of this subsection, the supervisor:

    (i) shall determine the fair market value of the land not subject to the declaration of intent as of the most recent July 1 and provide the transferee with a notice of that value, which the transferee may appeal as provided by Sec. 8-404 of this article; and

    (ii) calculate the amount of the tax due by multiplying the fair market value of the land subject to the tax by the rate of the tax provided under Sec. 13-303 of this subtitle.

  (4) If there is a failure to comply with a declaration of intent filed under paragraph (1) of this subsection or a failure to qualify for the farm or agricultural use assessment under Sec. 8-209 of this article during the time that a declaration of intent is in effect, the agricultural land transfer tax, plus penalty, is due on the land subject to the declaration of intent.

  (5) The tax and penalty due under this subsection are a lien on the agricultural land that was transferred. The tax and penalty are due on the earlier date of:

    (i) the date on which property tax on the agricultural land is due under Sec. 10-102 of this article; or

    (ii) the date of the next transfer of any part of the agricultural land.

  (6) For the purpose of paragraph (4) of this subsection, the supervisor shall calculate the amount of the agricultural land transfer tax due by:

    (i) determining the fair market value of the land subject to the tax as of the most recent July 1 and providing the property owner with a notice of that value, which the property owner may appeal as provided by Sec. 8-404 of this article;

    (ii) multiplying the fair market value of the land subject to the tax by the rate of the tax under Sec. 13-303 of this subtitle; and

    (iii) adding to the tax calculated under subparagraph (ii) of this paragraph a penalty in the amount of 10% of the tax due.

(d) The owner of real property which is subject to the agricultural use assessment must notify the Department when there is:

  (1) a failure to comply with a declaration of intent; or

  (2) failure to continue the property in agricultural use.

(e) If there is a failure to comply with a declaration of intent filed under subsection (b) or subsection (c) of this section, the supervisor in determining the fair market value of the land subject to the violation shall:

  (1) identify the size and location of the land by:

    (i) making a physical inspection of the property;

    (ii) considering pertinent governmental records such as building permits, zoning maps, and regulations;

    (iii) considering information provided by the property owner; and

    (iv) determining that in the case of the building of a dwelling for the residential use of the owner, the size of the building site is 1 acre unless more land is actually used; and

  (2) appraise the land utilizing generally accepted appraisal approaches including consideration of the sales of comparable land.

(f) For the purposes of subsections (c) and (e) of this section, if under current governmental land use regulations the parcel cannot be further subdivided into 2 or more parcels, the supervisor shall:

  (1) appraise the entire parcel; and

  (2) apportion the amount of the total market value of the parcel to that part of the parcel subject to the tax in accordance with generally accepted appraisal approaches including consideration of prevailing homesite land values in that area.

(g) In addition to the exemptions otherwise provided by this section, the agricultural land transfer tax does not apply to an instrument of writing described in Sec. 13-207(a) of this title.

(h) The agricultural land transfer tax does not apply to an instrument of writing that transfers title to agricultural land that was previously transferred by an instrument of writing that was subject to the agricultural land transfer tax.

#### Section 13-306

(a)

  (1) Except in Montgomery County and except as provided in subsection (b)(1) of this section for a certified county, each county collector shall remit from a special account to the Comptroller, as the Comptroller specifies:

    (i) the revenue from:

      (1) the agricultural transfer tax that is attributable to the taxation of instruments of writing that transfer title to parcels of land that are entirely woodland; and

      (2) the surcharge imposed under Sec. 13-303(d) of this subtitle; and

    (ii) two-thirds of the balance of revenue from the agricultural land transfer tax that remains after the remittance under item (i) of this paragraph.

  (2) In Montgomery County, if Sec. 52-21(d) (1979) of the Montgomery County Code is in effect or a transfer tax substantially similar to that provision is in effect, the collector for Montgomery County shall remit to the Comptroller:

    (i) the revenue from:

      (1) the agricultural transfer tax that is attributable to the taxation of instruments of writing that transfer title to parcels of land that are entirely woodland; and

      (2) the surcharge imposed under Sec. 13-303(d) of this subtitle; and

    (ii) one-third of the balance of revenue from the agricultural transfer tax that remains after the remittance under item (i) of this paragraph.

  (3) The Comptroller shall deposit:

    (i) up to $200,000 annually of the revenue remitted under paragraphs (1)(i) and (2)(i) of this subsection or subsection (b) of this section into the Mel Noland Woodland Incentives Fund established in Sec. 5-307 of the Natural Resources Article; and

    (ii) of the revenue in excess of $200,000 annually remitted under paragraphs (1)(i) and (2)(i) of this subsection or subsection (b)(1) of this section and the revenue remitted under paragraphs (1)(ii) and (2)(ii) of this subsection or subsection (b)(2) of this section:

      (1) subject to paragraph (4) of this subsection, for fiscal year 2011 and each fiscal year thereafter, $2,756,250 into the Maryland Agricultural Land Preservation Fund to be used for the purposes stated in Sec. 2-505 of the Agriculture Article;

      (2) after the distribution made under item 1 of this item, 37.5% of the agricultural land transfer tax revenue remitted to the Comptroller, up to a maximum of $4,000,000 annually, into a special fund to be used by the Maryland Agricultural and Resource-Based Industry Development Corporation for the Next Generation Farmland Acquisition Program; and

      (3) after the distributions made under items 1 and 2 of this item, the remainder into the Maryland Agricultural Land Preservation Fund to be used for the purposes stated in Sec. 2-505 of the Agriculture Article.

  (4) For each fiscal year after 2011, the amount distributed into the Maryland Agricultural Land Preservation Fund under paragraph (3)(ii)1 of this subsection shall be increased by 5% over the amount distributed for the preceding fiscal year.

  (5) The revenues required to be distributed to the Maryland Agricultural and Resource-Based Industry Development Corporation under paragraph (3) of this subsection shall be distributed on a quarterly basis on or about the first day of the month in July, October, January, and April.

(b) If a county is certified by the Department of Planning and the Maryland Agricultural Land Preservation Foundation under Sec. 5-408 of the State Finance and Procurement Article as having established an effective county agricultural land preservation program, the collector for the county shall remit to the Comptroller:

  (1) the revenue from:

    (i) the agricultural land transfer tax that is attributable to the taxation of instruments of writing that transfer title to parcels of land that are entirely woodland; and

    (ii) the surcharge imposed under Sec. 13-303(d) of this subtitle; and

  (2) 25% of the balance of revenue from the agricultural land transfer tax that remains after the remittance under item (1) of this subsection.

(c)

  (1) In this subsection, "development rights" means the potential for improvement of a parcel of real property that is measured in dwelling units or units of commercial or industrial space and that exist because of the zoning classification of the parcel.

  (2) Each county collector shall hold the remainder of the revenue in a special county account for 6 years to be used for an approved agricultural land preservation program that meets the requirements of this subsection, including use for bond annuity funds or matching funds.

  (3) For purposes of this subsection, an approved agricultural land preservation program is a program to purchase development rights, guarantee loans that are collateralized by development rights or provide financial enhancements related to purchase of development rights, for agricultural land that, except as provided in paragraph (4) of this subsection, meets the minimum standards set by the Maryland Agricultural Land Preservation Foundation under Sec. 2-509(d) of the Agriculture Article.

  (4) In lieu of any acreage requirement set by the Foundation under Sec. 2-509(d) of the Agriculture Article, development rights purchased by or collateralizing loans guaranteed by a county or financial enhancements related to purchase of development rights under this subsection shall be for agricultural land of significant size to promote an agricultural operation.

  (5)

    (i) Subject to the limitation under subparagraph (ii) of this paragraph, the funds described in paragraph (2) of this subsection may be used to pay administrative expenses.

    (ii) The costs of the administrative expenses may not exceed 10% of the funds or $30,000, whichever is the greater.

  (6) This subsection does not prohibit any county from accepting funds from private sources and using those private funds to purchase development rights, guarantee loans that are collateralized by development rights, or provide financial enhancements related to purchase of development rights.

(d) If any revenue in the special county account has not been expended or committed on or before 6 years from the date of deposit into the county account, the county collector shall remit that revenue to the Comptroller for deposit in the Maryland Agricultural Land Preservation Fund.

(e) From the agricultural land transfer tax collected by it, the Department shall remit the county part of the revenue to the collector for the county in which the land is located for distribution under this section.

#### Section 13-307

The Department shall adopt regulations to implement this subtitle.

#### Section 13-308

(a) When a contract is executed for the transfer of any interest in agricultural land, the seller shall notify the buyer, in writing, that the transfer may be subject to the agricultural land transfer tax.

(b) If a seller fails to notify a buyer as required by subsection (a) of this section, the seller is liable to the buyer for the agricultural land transfer tax paid by the buyer.

### Subtitle 4. County Transfer Taxes -- in General

#### Section 13-401

In this subtitle, "county transfer tax" means the transfer tax imposed by a county.

#### Section 13-402

(a) This subtitle applies in any county where the county imposes a transfer tax.

(b) The provisions of this subtitle are in addition to the public local laws of a county that relate to transfer taxes.

#### Section 13-402.1

(a) The governing body of a county that has adopted home rule powers under Article XI-F of the Maryland Constitution may impose a transfer tax on an instrument of writing:

  (1) recorded with the clerk of the circuit court for the county; or

  (2) filed with the Department.

(b) A transfer tax imposed under this section:

  (1) may not exceed 0.5%; and

  (2) does not apply to an instrument of writing exempt from the State transfer tax under Sec. 13-207 of this title.

#### Section 13-403

(a) In this section, "domestic partner", "evidence of a domestic partnership", "evidence of dissolution of a domestic partnership", and "former domestic partner" have the meanings stated in Sec. 12-101 of this article.

(b) An instrument of writing that transfers property between spouses or former spouses or between domestic partners or former domestic partners in accordance with a property settlement, divorce decree, or dissolution of a domestic partnership is not subject to a county transfer tax.

(c)

  (1) To qualify as a domestic partner under this section, an individual shall submit evidence of a domestic partnership.

  (2) To qualify as a former domestic partner under this section, an individual shall submit evidence of dissolution of a domestic partnership.

(d) The exemption under subsection (b) of this section for transfers between domestic partners or former domestic partners applies only to an instrument of writing for residential property.

#### Section 13-403.1

An instrument of writing pursuant to which the Maryland Stadium Authority transfers title to, or creates a leasehold interest in, real property if the transferee or lessee is an Authority affiliate as defined in Sec. 10-601 of the Economic Development Article is not subject to a county transfer tax.

#### Section 13-404

(a) The Department shall collect county transfer tax at the rate set by each county for articles of consolidation or articles of merger filed with the Department as required by Sec. 3-107, Sec. 4A-703, Sec. 9A-903, or Sec. 10-208 of the Corporations and Associations Article, or other document filed with the clerk of the circuit court of a county or the Department which evidences a merger or consolidation of foreign corporations, foreign limited liability companies, foreign partnerships, or foreign limited partnerships.

(b)

  (1) Articles of merger or other document which evidences a merger of foreign corporations are not subject to county transfer tax if the articles of merger or other document which evidences a merger of foreign corporations are for a transfer of real property from:

    (i) a parent corporation to its subsidiary corporation;

    (ii) a subsidiary corporation to its parent corporation where the parent corporation:

      (1) previously owned the real property;

      (2) owns the stock of the subsidiary and has owned that stock for a period greater than 18 months; or

      (3) acquires the stock of a subsidiary corporation which has been in existence and has owned the real property for a period of 2 years;

    (iii) a corporation merging out of existence to its successor corporation where recordation tax and, if then required to have been paid, transfer tax were paid when the corporation merging out of existence acquired title to the real property; or

    (iv) a corporation merging out of existence pursuant to reorganizations described in Sec. 368(a) of the Internal Revenue Code.

  (2) Articles of consolidation or other document which evidences a consolidation of foreign corporations are not subject to county transfer tax if the articles of consolidation or other document which evidences a consolidation of foreign corporations are for a transfer of real property from a consolidating corporation to its successor where recordation tax and, if then required to have been paid, transfer tax were paid when the corporation consolidating acquired title to the real property.

(c) A county that imposes a county transfer tax shall certify annually to the Department:

  (1) the rate of the tax;

  (2) the applicability of the county transfer tax; and

  (3) the legal authority for the county transfer tax.

(d) The Department shall:

  (1) collect any county transfer tax imposed under subsection (a) of this section;

  (2) deduct the cost to the Department of collecting county transfer tax under this section; and

  (3) distribute the remainder of the revenue to the county in which the property that is transferred is located.

(e)

  (1) Articles of merger, articles of consolidation, or other document which evidences a merger or consolidation of foreign corporations or foreign limited liability companies or foreign partnerships that are subject to county transfer tax under this section also may be taxable under Sec. 13-202 or Sec. 13-302 of this title or Sec. 12-102 of this article.

  (2) Before a transfer of title may be made under articles of transfer, articles of merger, articles of consolidation, or other document which evidences a merger or consolidation of foreign corporations or foreign limited liability companies or foreign partnerships for any property for which a property certificate is required under Sec. 3-112 or Sec. 4A-708 of the Corporations and Associations Article, all recordation and transfer taxes shall be paid.

#### Section 13-405

(a) Except as provided in subsection (c) of this section, county transfer tax applies to conveyances that transfer the real property of a corporation to its stockholders, a limited liability company to its members, or a partnership to its partners on:

  (1) liquidation;

  (2) dissolution; or

  (3) termination.

(b) For a conveyance that is taxable under this section, county transfer tax applies to the value of the real property determined by the Department at the date of finality immediately before the date of transfer.

(c) A corporate, limited liability company, or partnership transfer as described in Sec. 12-108(p), (q), (v), (w), (y), and (bb) of this article is not subject to the county transfer tax.

#### Section 13-406

In a transfer of property located in 2 or more counties, the county transfer tax of the counties where the property that is transferred is located is apportioned as required under Sec. 12-110(b) of this article.

#### Section 13-407

(a) In this section, "total rate of tax" means the rate of tax imposed for the agricultural land transfer tax under Sec. 13-303(a) of this title plus the rate of tax for a county transfer tax imposed under this section.

(b)

  (1) Unless a greater rate of tax was imposed before July 1, 1979, a county may not impose county transfer tax on a transfer subject to the agricultural land transfer tax under Subtitle 3 of this title at a rate greater than the county rate applicable to the transfer of improved residential property in that county.

  (2) If a county has imposed a county transfer tax at a rate that exceeds the rate applicable to the transfer of improved residential property, the total rate of tax that applies to a transfer subject to the agricultural land transfer tax may not exceed 5% plus the rate that applies to improved residential property under the county transfer tax.

  (3) If the total rate of tax that applies to a transfer subject to the agricultural land transfer tax exceeds the maximum rate allowed under paragraph (2) of this subsection:

    (i) the agricultural land transfer tax is payable at the rate specified in Sec. 13-303(a) of this title; and

    (ii) the rate of the county transfer tax shall be reduced as necessary to comply with the 5% limit.

(c) After July 1, 1979, for the transfer of land subject to the agricultural land transfer tax, a county may not:

  (1) impose a county transfer tax at a rate above the rate that was in effect on July 1, 1979; or

  (2) increase the rate of a county transfer tax above the rate that was in effect on July 1, 1979.

#### Section 13-408

Any county having a county transfer tax may provide for an exemption from the tax of a specified amount of the consideration payable on the conveyance of owner-occupied residential property if the buyer intends to use the property as the buyer's principal residence by actually occupying the residence for at least 7 months of a 12-month period.

#### Section 13-409

(a) Any county having a county transfer tax may provide for an exemption from the tax for an instrument of writing for residentially improved owner-occupied real property if the instrument of writing is accompanied by a statement under oath signed by each grantee or an agent of the grantee that:

  (1)

    (i) the grantee is an individual who has never owned in the State residential real property that has been the individual's principal residence; and

    (ii) the residence will be occupied by the grantee as the grantee's principal residence; or

  (2)

    (i) the grantee is a co-maker or guarantor of a purchase money mortgage or purchase money deed of trust as defined in Sec. 12-108(i) of this article for the property; and

    (ii) the grantee will not occupy the residence as the co-maker's or guarantor's principal residence.

(b) A statement under subsection (a) of this section by an agent of a grantee shall state that the statement:

  (1) is based on a diligent inquiry made by the agent with respect to the facts set forth in the statement; and

  (2) is true to the best of the knowledge, information, and belief of the agent.

#### Section 13-410

An instrument of writing is not subject to the county transfer tax to the same extent that it is not subject to the recordation tax under:

(1) Sec. 12-108(cc) of this article (Certain transfers to land trusts); or

(2) Sec. 12-108(hh) of this article (Transfer of real property within the Pimlico racing facility site, Pimlico site, Bowie Race Course Training Center property, or training facility site).

#### Section 13-411

An instrument of writing that a county or Baltimore City exempts from recordation tax under Sec. 12-118 of this article may be exempted from the county or Baltimore City transfer tax. 

#### Section 13-412

(a)

  (1) Except as provided in subsection (c) of this section and paragraph (2) of this subsection, a county transfer tax shall apply to the consideration payable for an instrument of writing.

  (2) If a county transfer tax applies to mortgages or deeds of trust, the county transfer tax shall apply to the consideration payable or the principal amount of the debt secured for an instrument of writing.

(b) Except as provided in subsection (c) of this section, the consideration:

  (1) includes the amount of any mortgage or deed of trust assumed by the grantee; and

  (2) subject to item (1) of this subsection, includes only the amount paid or delivered in return for the sale of the property and does not include the amount of any debt forgiven or no longer secured by a mortgage or deed of trust on the property.

(c)

  (1) A county transfer tax applies to the consideration paid for the transfer of a controlling interest in a real property entity as defined in Sec. 13-103 of this title that has developed real property under Section 42 of the Internal Revenue Code, the Low Income Housing Tax Credit Program.

  (2) The consideration under this subsection shall be the actual payment made by the purchaser to the seller for the purchase of the interest.

#### Section 13-413

An instrument of writing that is exempt from recordation tax under Sec. 12-108(gg) of this article (Transfer of principal residence surrendered in bankruptcy) is not subject to the county transfer tax.

#### Section 13-414

An instrument of writing that is exempt from recordation tax under Sec. 12-108(ii) of this article (real property transfer-on-death deed) is not subject to county transfer tax.

### Subtitle 5. Washington County Agricultural Land Transfer Tax

#### Section 13-501

(a) In this subtitle the following words have the meanings indicated.

(b) "Agricultural land" means real property that is or was assessed on the basis of farm or agricultural use under Sec. 8-209 of this article.

(c) "County agricultural land transfer tax" means the tax imposed under this subtitle.

(d) "Development rights" has the meaning stated in Sec. 2-512(e) of the Agriculture Article.

(e) "Foundation" means the Maryland Agricultural Land Preservation Foundation.

#### Section 13-502

(a)

  (1) The Board of County Commissioners of Washington County may, with the advice and consent of the local Agricultural Preservation Advisory Board, levy and impose a county agricultural land transfer tax on an instrument of writing for property located in the county if the instrument is subject to the State agricultural land transfer tax under Subtitle 3 of this title.

  (2) Notwithstanding the provisions of Sec. 13-407 of this title, the tax imposed under this section may be imposed at a rate of up to 2%.

(b) The county agricultural land transfer tax is imposed on the value of the agricultural land used to determine the State agricultural transfer tax.

(c) The county agricultural land transfer tax is payable in addition to any other transfer tax imposed by State law.

(d) An instrument of writing that is subject to the county agricultural land transfer tax may not be recorded in the county or filed with the Department until the county agricultural land transfer tax is paid to the county tax collector or the Department.

#### Section 13-503

(a) The Department shall remit the county agricultural land transfer tax collected by it to the county tax collector.

(b) The county tax collector shall deposit in a special fund all of the agricultural land transfer tax collected under this subtitle.

(c) The county agricultural land transfer tax collected under this subtitle may be used only for the purchase of development rights on agricultural land under the county's or foundation's agricultural preservation program.

(d)

  (1) Except as provided in paragraph (2) of this subsection, agricultural land on which development rights are purchased under this subtitle must meet the minimum standards set by the foundation under Sec. 2-509(d) of the Agriculture Article.

  (2) In lieu of any acreage requirements set by the foundation under Sec. 2-509(d) of the Agriculture Article, agricultural land on which development rights are purchased under this subtitle must be of significant size to promote an agricultural operation.

(e) This section may not be construed to prohibit any county from accepting funds from private sources and using those private funds to purchase development rights on agricultural land.

#### Section 13-504

(a) When a contract is executed for the transfer of any interest in agricultural land in Washington County, the seller shall notify the buyer, in writing, that the transfer may be subject to the county agricultural land transfer tax.

(b) If a seller fails to notify a buyer as required by subsection (a) of this section, the seller is liable to the buyer for the county agricultural land transfer tax paid by the buyer.

#### Section 13-505

(a) A person may not willfully offer for recordation or record an instrument of writing subject to the county agricultural land transfer tax knowing that the tax has not been paid.

(b) A person may not willfully misrepresent the amount of the actual consideration paid or to be paid in connection with an instrument of writing that is subject to the county agricultural land transfer tax.

(c) A person may not forge or counterfeit any official legend or signature of the clerk on any instrument of writing that is subject to the county agricultural land transfer tax.

(d) A person who violates a provision of this section is guilty of a misdemeanor and on conviction is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

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Md. Code Ann., Tax-Prop. (as displayed at mgaleg.maryland.gov, October 16, 2026)