The Florida documentary stamp tax on real estate transfers is imposed on the consideration paid on real estate transfers, such as cash paid for a transfer by deed, at a rate of $700 per $100,000 of consideration.
There are exceptions to the tax, such as unencumbered property transferred between spouses as a gift, transfers by a trust to the trust beneficiary, or transfers by a business entity to an affiliate with the same ownership in a reorganization.
The tax is usually paid to the county Clerk of Court when the deed is recorded in the county real estate official records, and then remitted to the Department of Revenue in Tallahassee. 1. The newspaper account did not consider that the documentary stamp tax for trust and business entity interests is paid directly to the Department of Revenue in Tallahassee, not the local Clerk of Court.
2. The reviewer assumed that no tax was paid because there was no evidence of payment in the Clerk of Court’s office, without considering the different payment process.
3. Some of the transfers to trusts and business entities may have been exempt transactions, such as internal reorganizations, and not sales of interests. 1. The documentary stamp tax audit rate is high.
2. Auditors can identify initial deeds on which no tax is paid.
3. Taxpayers are required to prove they paid the tax directly to the Department of Revenue in Tallahassee on a subsequent indirect non-deed transfer.
4. The citizenry cannot independently confirm documentary stamp tax has been paid.
5. There should be no greater concern about tax fraud in these transactions than there is for tax collection generally.
https://www.williamsparker.com/insights/is-an-unintended-documentary-stamp-tax-loophole-depriving-florida-of-tax-revenue/
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