CHAPTER 223
REAL ESTATE CONVEYANCE TAX

Table of Contents

Sec. 12-494. Imposition of tax on conveyances of real property for consideration. One part payable to state and the other to municipality in which paid.
Sec. 12-504a. Conveyance tax on sale or transfer of land classified as farm, forest, open space or maritime heritage land.
Sec. 12-504c. Excepted transfers.
Sec. 12-504e. Conveyance tax applicable on change of use or classification of land.
Sec. 12-504f. Classification of land classified as farm, forest, open space or maritime heritage land personal to owner. Certificate of classification.
Sec. 12-504h. Termination of classification as farm, forest, open space or maritime heritage land.

      Sec. 12-494. Imposition of tax on conveyances of real property for consideration. One part payable to state and the other to municipality in which paid. (a) There is imposed a tax on each deed, instrument or writing, whereby any lands, tenements or other realty is granted, assigned, transferred or otherwise conveyed to, or vested in, the purchaser, or any other person by his direction, when the consideration for the interest or property conveyed equals or exceeds two thousand dollars, (1) subject to the provisions of subsection (b) of this section, at the rate of five-tenths of one per cent of the consideration for the interest in real property conveyed by such deed, instrument or writing, the revenue from which shall be remitted by the town clerk of the municipality in which such tax is paid, not later than ten days following receipt thereof, to the Commissioner of Revenue Services for deposit to the credit of the state General Fund, and (2) at the rate of one-fourth of one per cent of the consideration for the interest in real property conveyed by such deed, instrument or writing, and on and after July 1, 2008, at the rate of eleven one-hundredths of one per cent of the consideration for the interest in real property conveyed by such deed, instrument or writing, provided the amount imposed under this subdivision shall become part of the general revenue of the municipality in accordance with section 12-499.

      (b) The rate of tax imposed under subdivision (1) of subsection (a) of this section shall, in lieu of the rate under said subdivision (1), be imposed on certain conveyances as follows: (1) In the case of any conveyance of real property which at the time of such conveyance is used for any purpose other than residential use, except unimproved land, the tax under said subdivision (1) shall be imposed at the rate of one per cent of the consideration for the interest in real property conveyed; (2) in the case of any conveyance in which the real property conveyed is a residential estate, including a primary dwelling and any auxiliary housing or structures, regardless of the number of deeds, instruments or writings used to convey such residential real estate, for which the consideration or aggregate consideration, as the case may be, in such conveyance is eight hundred thousand dollars or more, the tax under said subdivision (1) shall be imposed (A) at the rate of one-half of one per cent on that portion of such consideration up to and including the amount of eight hundred thousand dollars, and (B) at the rate of one per cent on that portion of such consideration in excess of eight hundred thousand dollars; and (3) in the case of any conveyance in which real property on which mortgage payments have been delinquent for not less than six months is conveyed to a financial institution or its subsidiary which holds such a delinquent mortgage on such property, the tax under said subdivision (1) shall be imposed at the rate of one-half of one per cent of the consideration for the interest in real property conveyed. For the purposes of subdivision (1) of this subsection, "unimproved land" includes land designated as farm, forest or open space land.

      (c) In addition to the tax imposed under subsection (a) of this section, any targeted investment community, as defined in section 32-222, or any municipality in which properties designated as manufacturing plants under section 32-75c are located, may, on or after March 15, 2003, impose an additional tax on each deed, instrument or writing, whereby any lands, tenements or other realty is granted, assigned, transferred or otherwise conveyed to, or vested in, the purchaser, or any other person by his direction, when the consideration for the interest or property conveyed equals or exceeds two thousand dollars, which additional tax shall be at a rate of up to one-fourth of one per cent of the consideration for the interest in real property conveyed by such deed, instrument or writing. The revenue from such additional tax shall become part of the general revenue of the municipality in accordance with section 12-499.

      (1967, P.A. 693, S. 1; 1971, P.A. 158, S. 2; June Sp. Sess. P.A. 83-1, S. 6, 15; P.A. 85-480, S. 1, 3; P.A. 86-397, S. 8, 10; P.A. 89-205, S. 1; 89-251, S. 19, 203; P.A. 91-356, S. 1, 3; P.A. 92-57, S. 1, 2; P.A. 03-2, S. 40; P.A. 04-201, S. 4; 04-216, S. 51; P.A. 05-268, S. 1, 2; P.A. 07-154, S. 6; June Sp. Sess. P.A. 07-1, S. 128.)

      History: 1971 act substituted "consideration for the interest or property conveyed" for "consideration or value of the interest or property conveyed"; June Sp. Sess. P.A. 83-1 provided for imposition of a conveyance tax, payable to the state on each deed or other instrument conveying lands, tenements or other realty at the rate of 0.5% of the purchase price for the interest in real property conveyed and for continuation of the existing conveyance tax payable to the municipality at the rate of $1.10 for each $1,000 of purchase price, effective July 1, 1983, and applicable to conveyances occurring on or after said date; P.A. 85-480 amended the language of imposition so that the tax is imposed on the sale or transfer of real property and not upon the deed or instrument of conveyance; P.A. 86-397 reduced the rate of tax from .05% to .045% of the full purchase price for the interest in real property conveyed, effective June 11, 1986, and applicable to any conveyance of an interest in real property occurring on or after January 1, 1987; P.A. 89-205 made technical changes, including descriptions of the imposition of tax as applied to the deed in lieu of imposition on the sale or transfer of an interest in real property and of the rate of tax as being applied to the consideration for the interest conveyed in lieu of the full purchase price; P.A. 89-251 increased the tax under Subsec. (a)(1) from .045% to 0.5% of the consideration, changed the rate of tax in Subsec. (a)(2) from $1.10 for each $1,000 of full purchase price to 0.011% of the consideration and added Subsec. (b) providing for a higher rate of tax on conveyances for purposes other than residential and for residential property in the case of an estate for which the consideration exceeds $800,000; P.A. 91-356 added Subsec. (b)(3), re rate for certain transfers in lieu of foreclosure, effective July 1, 1991, and applicable to conveyances occurring on or after said date; P.A. 92-57 amended Subsec. (b)(3) by including conveyances to the subsidiary of a financial institution holding a delinquent mortgage on the conveyed real property, effective July 1, 1992, and applicable to conveyances occurring on or after that date; P.A. 03-2 amended Subsec. (a) to make technical changes and increase the municipal portion of the tax to 0.25% from March 15, 2003, until July 1, 2004, made a technical change in Subsec. (b) and added new Subsec. (c) re an additional tax which certain municipalities may impose during said period, effective March 15, 2003; P.A. 04-201 amended Subsec. (b) to add provisions re multiple instruments used to convey residential property, effective June 3, 2004; P.A. 04-216 amended Subsec. (a)(2) to extend the time period for the higher rate thereunder until July 1, 2005, and amended Subsec. (c) to delete sunset provision related to the tax imposed under that subsection, effective May 6, 2004; P.A. 05-268 amended Subsec. (a) to retain the rate of 0.25% until July 1, 2007, and amended Subsec. (c) to make a technical change and add "up to" re additional tax rate, effective July 1, 2005; P.A. 07-154 amended Subsec. (b) to define "unimproved land", effective July 1, 2007; June Sp. Sess. P.A. 07-1 amended Subsec. (a) to retain the rate of 0.25% until July 1, 2008, effective July 1, 2007.

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      Sec. 12-504a. Conveyance tax on sale or transfer of land classified as farm, forest, open space or maritime heritage land. (a) If at any time there is a change of ownership for any property that is classified as farm land pursuant to section 12-107c, forest land pursuant to section 12-107d, open space land pursuant to section 12-107e or maritime heritage land pursuant to section 12-107g, a revised application shall be filed with the assessor pursuant to said section 12-107c, 12-107d, 12-107e or section 12-107g.

      (b) Any land which has been classified by the record owner thereof as open space land pursuant to section 12-107e or as maritime heritage land pursuant to section 12-107g, if sold or transferred by him within a period of ten years from the time he first caused such land to be so classified, shall be subject to a conveyance tax applicable to the total sales price of such land, which tax shall be in addition to the tax imposed under sections 12-494 to 12-504, inclusive. Said conveyance tax shall be at the following rate: (1) Ten per cent of said total sales price if sold within the first year following the date of such classification; (2) nine per cent if sold within the second year following the date of such classification; (3) eight per cent if sold within the third year following the date of such classification; (4) seven per cent if sold within the fourth year following the date of such classification; (5) six per cent if sold within the fifth year following the date of such classification; (6) five per cent if sold within the sixth year following the date of such classification; (7) four per cent if sold within the seventh year following the date of such classification; (8) three per cent if sold within the eighth year following the date of such classification; (9) two per cent if sold within the ninth year following the date of such classification; and (10) one per cent if sold within the tenth year following the date of such classification. No conveyance tax shall be imposed on such record owner by the provisions of sections 12-504a to 12-504f, inclusive, following the end of the tenth year after the date of such classification by the record owner or person acquiring title to such land or causing such land to be so classified.

      (c) Any land which has been classified by the record owner thereof as farm land pursuant to section 12-107c or as forest land pursuant to section 12-107d, if sold or transferred by him within a period of ten years from the time he acquired title to such land or from the time he first caused such land to be so classified, whichever is earlier, shall be subject to a conveyance tax applicable to the total sales price of such land, which tax shall be in addition to the tax imposed under sections 12-494 to 12-504, inclusive. Said conveyance tax shall be at the following rate: (1) Ten per cent of said total sales price if sold within the first year of ownership by such record owner; (2) nine per cent if sold within the second year of ownership by such record owner; (3) eight per cent if sold within the third year of ownership by such record owner; (4) seven per cent if sold within the fourth year of ownership by such record owner; (5) six per cent if sold within the fifth year of ownership by such record owner; (6) five per cent if sold within the sixth year of ownership by such record owner; (7) four per cent if sold within the seventh year of ownership by such record owner; (8) three per cent if sold within the eighth year of ownership by such record owner; (9) two per cent if sold within the ninth year of ownership by such record owner; and (10) one per cent if sold within the tenth year of ownership by such record owner. No conveyance tax shall be imposed by the provisions of sections 12-504a to 12-504f, inclusive, following the end of the tenth year of ownership by the record owner or person acquiring title to such land or causing such land to be so classified.

      (1972, P.A. 152, S. 1; P.A. 74-343, S. 1, 7; P.A. 79-513, S. 5, 6; P.A. 80-483, S. 57, 186; P.A. 87-589, S. 22, 87; P.A. 05-190, S. 6; P.A. 07-127, S. 6.)

      History: P.A. 74-343 added references to record owner of land and made technical change re ten-year period during which conveyance tax applies; P.A. 79-513 amended section to make tax applicable to only ten-year period after land first classified, deleting alternate applicability to ten-year period after land acquired, if earlier, effective July 1, 1979, and applicable to the sale of any land classified for the first time as farm, forest or open space land on or after that date; P.A. 80-483 added Subsec. (b) re conveyance tax on land classified as farm land; P.A. 87-589 made technical change in Subsec. (b), substituting reference to Sec. 12-494 for reference to Sec. 12-294; P.A. 05-190 added new Subsec. (a) re submission of a revised application upon change of ownership of property classified as farm land, forest land or open space land, redesignated existing Subsecs. (a) and (b) as new Subsecs. (b) and (c), and amended said Subsecs. to apply provisions to land transferred and make tax applicable to person acquiring title or causing land to be classified, effective July 1, 2005, and applicable to sales, transfers or changes in use of land classified as farm land, forest land or open space land that occur on or after that date; P.A. 07-127 added references to maritime heritage land pursuant to Sec. 12-107g in Subsecs. (a) and (b), effective July 1, 2007.

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      Sec. 12-504c. Excepted transfers. The provisions of section 12-504a shall not be applicable to the following: (1) Transfers of land resulting from eminent domain proceedings; (2) mortgage deeds; (3) deeds to or by the United States of America, state of Connecticut or any political subdivision or agency thereof; (4) strawman deeds and deeds which correct, modify, supplement or confirm a deed previously recorded; (5) deeds between husband and wife and parent and child when no consideration is received, except that a subsequent nonexempt transfer by the grantee in such cases shall be subject to the provisions of said section 12-504a as it would be if the grantor were making such nonexempt transfer; (6) tax deeds; (7) deeds of foreclosure; (8) deeds of partition; (9) deeds made pursuant to a merger of a corporation; (10) deeds made by a subsidiary corporation to its parent corporation for no consideration other than the cancellation or surrender of the capital stock of such subsidiary; (11) property transferred as a result of death when no consideration is received and in such transfer the date of acquisition or classification of the land for purposes of sections 12-504a to 12-504f, inclusive, or section 12-107g, whichever is earlier, shall be the date of acquisition or classification by the decedent; (12) deeds to any corporation, trust or other entity, of land to be held in perpetuity for educational, scientific, aesthetic or other equivalent passive uses, provided such corporation, trust or other entity has received a determination from the Internal Revenue Service that contributions to it are deductible under applicable sections of the Internal Revenue Code; (13) land subject to a covenant specifically set forth in the deed transferring title to such land, which covenant is enforceable by the town in which such land is located, to refrain from selling, transferring or developing such land in a manner inconsistent with its classification as farm land pursuant to section 12-107c, forest land pursuant to section 12-107d, open space land pursuant to section 12-107e or maritime heritage land pursuant to section 12-107g, for a period of not less than eight years from the date of transfer, if such covenant is violated the conveyance tax set forth in this chapter shall be applicable at the rate multiplied by the market value as determined by the assessor which would have been applicable at the date the deed containing the covenant was delivered and, in addition, the town or any taxpayer therein may commence an action to enforce such covenant; (14) land the development rights to which have been sold to the state under chapter 422a; and (15) deeds to or from any limited liability company when the grantors or grantees are the same individuals as the principals or members of the limited liability company. If action is taken under subdivision (13) of this section by a taxpayer, such action shall commence prior to the ninth year following the date of the deed containing such covenant and the town shall be served as a necessary party.

      (1972, P.A. 152, S. 3; P.A. 73-585, S. 1; P.A. 99-173, S. 50, 65; P.A. 05-190, S. 7; P.A. 07-127, S. 7.)

      History: P.A. 73-585 added Subdivs. (l) and (m) exempting deeds of land to be held in perpetuity for educational, scientific, aesthetic, etc. purposes and land subject to covenant; P.A. 99-173 added Subdiv. (n) re land the development rights to which have been sold to the state under chapter 422a, effective June 23, 1999, and applicable to transfers made on or after July 1, 1999; P.A. 05-190 replaced alphabetic subdivision designators with numeric designators, deleted former provision re deeds releasing property which is security for debt or other obligation, added new Subdiv. (7) exempting deeds of foreclosure, amended Subdiv. (11) to limit provisions to transfers when no consideration is given, amended Subdiv. (13) to provide that the applicable tax shall be determined at a rate multiplied by the market value as determined by the assessor, added Subdiv. (15) exempting deeds to or from limited liability companies under certain conditions, added provision re action taken under Subdiv. (13) to commence prior to ninth year following date of deed, and made technical changes throughout, effective July 1, 2005, and applicable to sales, transfers or changes in use of land classified as farm land, forest land or open space land that occur on or after that date; P.A. 07-127 added references to Sec. 12-107g and maritime heritage land in Subdivs. (11) and (13), effective July 1, 2007.

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      Sec. 12-504e. Conveyance tax applicable on change of use or classification of land. Any land which has been classified by the owner as farm land pursuant to section 12-107c, as forest land pursuant to section 12-107d, open space land pursuant to section 12-107e or maritime heritage land pursuant to section 12-107g, if changed by him, within a period of ten years of his acquisition of title, to use other than farm land, forest land, open space land or maritime heritage land, shall be subject to said conveyance tax as if there had been an actual conveyance by him, as provided in sections 12-504a and 12-504b, at the time he makes such change in use. For the purposes of this section: (1) The value of any such property shall be the fair market value thereof as determined by the assessor in conjunction with the most recent revaluation, and (2) the date used for purposes of determining such tax shall be the date on which the use of such property is changed, or the date on which the assessor becomes aware of a change in use of such property, whichever occurs first.

      (1972, P.A. 152, S. 5; P.A. 74-343, S. 3, 7; P.A. 05-190, S. 9; P.A. 07-127, S. 8.)

      History: P.A. 74-343 specified classification within ten-year period of acquisition of title and made technical changes for clarity; P.A. 05-190 revised provision re use of fair market value to determine value of property and added provision re date used for determining the tax, effective July 1, 2005, and applicable to sales, transfers or changes in use of land classified as farm land, forest land or open space land that occur on or after that date; P.A. 07-127 added references to Sec. 12-107g and maritime heritage land and made technical changes, effective July 1, 2007.

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      Sec. 12-504f. Classification of land classified as farm, forest, open space or maritime heritage land personal to owner. Certificate of classification. The tax assessor shall file annually, not later than sixty days after the assessment date, with the town clerk a certificate for any land which has been classified as farm land pursuant to section 12-107c, as forest land pursuant to section 12-107d, as open space land pursuant to section 12-107e or as maritime heritage land pursuant to section 12-107g, which certificate shall set forth the date of the initial classification and the obligation to pay the conveyance tax imposed by this chapter. Said certificate shall be recorded in the land records of such town. Any such classification of land shall be deemed personal to the particular owner who requests such classification and shall not run with the land. The town clerk shall notify the tax assessor of the filing in the land records of the sale of any such land. Upon receipt of such notice the tax assessor shall inform the new owner of the tax benefits of classification of such land as farm land, forest land or open space land.

      (1972, P.A. 152, S. 6; June, 1972, P.A. 1, S. 12; P.A. 73-585, S. 2; P.A. 74-343, S. 4, 7; P.A. 05-190, S. 11; P.A. 07-127, S. 9.)

      History: 1972 act specified that annual filing to be "not later than 60 days after the assessment date"; P.A. 73-585 required that certificate set forth date of initial classification and obligation to pay conveyance tax; P.A. 74-343 added provision which stated that land classification personal to owner and does not run with land; P.A. 05-190 added provision requiring town clerk to notify the tax assessor of sale and requiring the tax assessor to notify the new owner of tax benefits of classification of land as farm land, forest land or open space land, effective July 1, 2005; P.A. 07-127 added references to Sec. 12-107g and maritime heritage land, effective July 1, 2007.

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      Sec. 12-504h. Termination of classification as farm, forest, open space or maritime heritage land. Any such classification of farm land pursuant to section 12-107c, forest land pursuant to section 12-107d, open space land pursuant to section 12-107e or maritime heritage land pursuant to section 12-107g, shall be deemed personal to the particular owner who requests and receives such classification and shall not run with the land. Any such land which has been classified by a record owner shall remain so classified without the filing of any new application subsequent to such classification, notwithstanding the provisions of sections 12-107c, 12-107d, 12-107e and section 12-107g, until either of the following shall occur: (1) The use of such land is changed to a use other than that described in the application for the existing classification by said record owner, or (2) such land is sold or transferred by said record owner. Upon the sale or transfer of any such property, the classification of such land as farm land pursuant to section 12-107c, forest land pursuant to section 12-107d, open space land pursuant to section 12-107e or maritime heritage land pursuant to section 12-107g, shall cease as of the date of sale or transfer. In the event that a change in use of any such property occurs, the provisions of section 12-504e, shall apply in terms of determining the date of change and the classification of such land as farm land pursuant to section 12-107c, forest land pursuant to section 12-107d, open space land pursuant to section 12-107e or maritime heritage land pursuant to section 12-107g, shall cease as of such date.

      (P.A. 74-343, S. 6, 7; P.A. 05-190, S. 10; P.A. 07-127, S. 10.)

      History: P.A. 05-190 added provision deeming classification of farm land, forest land or open space land to be personal to owner and shall not run with the land, provided that upon sale or transfer of property, the classification ceases as of the date of the sale or transfer and made technical changes, effective July 1, 2005, and applicable to sales, transfers or changes in use of land classified as farm land, forest land or open space land that occur on or after that date; P.A. 07-127 added references to Sec. 12-107g and maritime heritage land, effective July 1, 2007.

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