SB 301-FN - AS AMENDED BY THE SENATE
SENATE BILL 301-FN
AN ACT temporarily reducing the real estate transfer tax for first-time home buyers.
SPONSORS: Sen. Bradley, Dist 3; Sen. Avard, Dist 12; Sen. Carson, Dist 14; Sen. French, Dist 7; Sen. Fuller Clark, Dist 21; Sen. Gannon, Dist 23; Sen. Gray, Dist 6; Sen. Hennessey, Dist 5; Sen. Innis, Dist 24; Sen. Lasky, Dist 13; Sen. Morse, Dist 22; Sen. Watters, Dist 4; Rep. Hinch, Hills. 21; Rep. Shurtleff, Merr. 11; Rep. Abrami, Rock. 19; Rep. Butler, Carr. 7
COMMITTEE: Ways and Means
This bill reduces, for a 2-year period, the rate of the tax on the transfer of real property for first time home buyers, provided the purchase price does not exceed $300,000. The bill also requires the department of revenue administration to report on the usage of the reduced rate.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
02/22/2018 0820s 18-2917
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Eighteen
Be it Enacted by the Senate and House of Representatives in General Court convened:
(b) Except as provided in RSA 78-B:1-b, the rate of the tax is $.75 per $100, or fractional part thereof, of the price or consideration for such sale, grant, or transfer; except that where the price or consideration is $4,000 or less there shall be a minimum tax of $20. The tax imposed shall be computed to the nearest whole dollar.
78-B:1-b Rate of Transfer Tax for First Time Home Buyers. Notwithstanding RSA 78-B:1, I(b), beginning January 1, 2018 the rate of the tax is $.50 per $100, or fractional part thereof, of the price or consideration for such sale, grant, or transfer applicable to the buyer for the purchase of a qualifying first home, as follows:
I. The rate of tax provided for in this section shall be applied to the amount of tax owed by and actually paid by the buyer pursuant to RSA 78-B:1 and shall not apply to any amounts paid by the buyer on behalf of the seller.
II. For purposes of this section, the term:
(a) "Qualifying first home" shall mean:
(1) The purchase of residential real estate, the price of which does not exceed $300,000;
(2) That will be utilized as the buyer's principal residence as defined in Internal Revenue Code Section 121 and related Treasury Regulations; and
(3) That is the buyer's first purchase of residential real estate.
(b) "Buyer'' shall mean the purchaser, grantee, assignee, or transferee of any real estate or any interest in real estate.
III. Except as provided in RSA 78-B:1-b, the rate of tax established in RSA 78-B:1 shall apply to both the purchaser, grantee, assignee or transferee and the seller, grantor, assignor or transferor.
(b) [Except as provided in RSA 78-B:1-b,] The rate of the tax is $.75 per $100, or fractional part thereof, of the price or consideration for such sale, grant, or transfer; except that where the price or consideration is $4,000 or less there shall be a minimum tax of $20. The tax imposed shall be computed to the nearest whole dollar.
III. [Except as provided in RSA 78-B:1-b,] The rate of tax established in RSA 78-B:1 shall apply to both the purchaser, grantee, assignee or transferee and the seller, grantor, assignor or transferor.
8 Report Required; Department of Revenue Administration. On or before January 1, 2019 and on or before January 1, 2020, the commissioner of revenue administration shall report to the speaker of the house of representatives, the senate president, and the governor on the number of first-time home buyers using the lower transfer tax rate provided in RSA 78-B:1-b and the department's assessment of whether the number of first-time home buyers increased or decreased as a result of the reduced tax rate.
I. Sections 5-7 of this act shall take effect January 1, 2020.
II. The remainder of this act shall take effect upon its passage.
SB 301-FN- FISCAL NOTE
AS AMENDED BY THE SENATE (AMENDMENT #2018-0820s)
FISCAL IMPACT: [ X ] State [ X ] County [ ] Local [ ] None
Estimated Increase / (Decrease)
[ X ] General [ X ] Education [ ] Highway [ ] Other
This bill would reduce the Real Estate Transfer tax rate for first-time home buyers from $0.75 to $0.50 per $100 of the sale price, for prices not exceeding $300,000, for a period of two years applicable to transfers from January 1, 2018 through December 31, 2019. The Department of Revenue Administration would be required to report on the number of first-time home buyers using the lower rate and whether first-time home buyers increased or decreased as a result of the reduced rate.
The Department of Revenue Administration indicates this bill would reduce State General Fund and Education Trust Fund unrestricted revenue by an interminable amount in FY 2018, FY 2019 and FY 2020. The Department would be responsible for updating and developing necessary forms and electronic management systems including the creation or editing of forms in order to capture the status of buyers as either a first-time or a repeat home buyer. The Department assumes these updates could be absorbed within their existing budget. The Department has no way to estimate the decrease in Real Estate Transfer Tax revenue since it doesn’t collect data on the status of home buyers as either repeat or first time home buyers and cannot predict the prices of homes purchased by first-time buyers. Each county collects the Real Estate Transfer Tax and remits the amount due to the Department. Counties deduct a 4% commission on the tax collected, therefore any decrease in the tax would also decrease county revenue. The impact on county administration costs is indeterminable.
Since the bill is effective upon passage and is applicable to transfers beginning January 1, 2018, some number of transfers will have taken place before the effective date and initially subject to the higher rate. The Department assumes those buyers would be entitled to a refund. The Department states the January 1, 2018 date would not provide sufficient time to update the tax return forms and electronic systems.
Department of Revenue Administration
|Jan. 24, 2018||Senate||Hearing|
|Feb. 22, 2018||Senate||Floor Vote|
|March 8, 2018||Senate||Floor Vote|
|March 20, 2018||House||Hearing|
|April 3, 2018||House||Exec Session|
|Jan. 3, 2018||To Be Introduced 01/03/2018 and Referred to Ways and Means; SJ 1|
|Jan. 24, 2018||Hearing: 01/24/2018, Room 100, SH, 09:40 AM; SC 4|
|Feb. 22, 2018||Committee Report: Inexpedient to Legislate, 02/22/2018; SC 8|
|Feb. 22, 2018||Inexpedient to Legislate, MF, VV; 02/22/2018; SJ 5|
|Feb. 22, 2018||Sen. Bradley Moved Ought to Pass; 02/22/2018; SJ 5|
|Feb. 22, 2018||Sen. Bradley Floor Amendment # 2018-0820s, AA, VV; 02/22/2018; SJ 5|
|Feb. 22, 2018||Ought to Pass with Amendment 2018-0820s, RC 22Y-0N, MA; Refer to Finance Rule 4-5; 02/22/2018; SJ 5|
|March 8, 2018||Committee Report: Ought to Pass, 03/08/2018; SC 10A|
|March 8, 2018||Ought to Pass: RC 19Y-4N, MA; OT3rdg; 03/08/2018; SJ 6|
|March 7, 2018||Introduced 03/07/2018 and referred to Ways and Means HJ 7 P. 53|
|March 20, 2018||Public Hearing: 03/20/2018 10:00 AM LOB 202|
|March 27, 2018||Full Committee Work Session: 03/27/2018 11:00 AM LOB 202|
|April 3, 2018||Executive Session: 04/03/2018 10:00 AM LOB 202|
|Committee Report: Refer for Interim Study (Vote 22-1; CC)|
|April 12, 2018||Committee Report: Refer for Interim Study for 04/12/2018 (Vote 22-1; CC) HC 14 P. 6|
|April 12, 2018||Refer for Interim Study: MA VV 04/12/2018 HJ 12 P. 9|