Documentary Transfer Tax Exemptions

Documentary Transfer Tax Exemptions: Documentary Transfer Taxes are collected on almost every recorded transfer of interest in real property. Documentary Transfer Tax is computed when the consideration or value of the interest or property conveyed (exclusive of the value of any lien or encumbrance remaining thereon at the time of sale) exceeds one hundred dollars ($100). The California Transfer Tax Act does provide for a number of exemptions from the payment of transfer taxes. The Exemptions provided are described below:

1. Conveyance Confirming Title in Grantee
“This conveyance confirms title to the grantee(s) who continue to hold the same interest acquired on Date_________________, Document No.___________________ wherein $_____________ Documentary Transfer Tax was paid, R & T 11911.”

2. Conveyance in Dissolution of Marriage
“This conveyance is in dissolution of marriage by one spouse to the other, R & T 11927.”

3. Conveyance to Secure a Debt
“This conveyance is to secure a debt, R & T 11921.”

4. Reconveyance upon Satisfaction of a Debt
“This is a reconveyance of realty upon satisfaction of a debt, R & T 11921.”

5. Conveyances transferring Interests into or out of a Living Trust
“This conveyance transfers an interest into or out of a Living Trust, R & T 11930.”

6. Conveyance Changing Manner in Which Title is Held
“This conveyance changes the manner in which title is held, grantor(s) and grantee(s) remain the same and continue to hold the same proportionate interest, R & T 11911.”

7. Court Ordered Conveyances Not Pursuant to Sale
“This is a court‐ordered conveyance or decree that is not pursuant to sale, R & T 11911.”

8. Conveyance Given by Reason of Inter Vivos Gift or by Reason of Death of Person Holding Title
“This is a gift and the grantor received nothing in return or conveyance by reason of death, R & T 11930”.

9. Conveyance to Establish Sole and Separate Property of a Spouse
“This conveyance establishes sole and separate property of a spouse, R & T 11911.”

10. Conveyance to Confirm a Community Property Interest when the property was purchased with
Community Property Funds – “This conveyance confirms a community property interest, which was purchased with Community Property Funds, R & T 11911.”

11. Conveyances to Confirm a Change of Name
“This conveyance confirms a change of name, and the grantor and grantee are the same party, R & T 11911.”

12. Conveyances of an Easement or Oil and Gas Lease Where the Consideration and Value is Less Than
“This is a conveyance of an easement (Oil and Gas Lease) and the consideration and value is less than $100.00, R & T 11911.”

13. Conveyances Where the Liens and Encumbrances Are Equal or More Than the Value of Property,
and No Further Consideration is Given
“The value of the property in this conveyance, exclusive of liens and encumbrances is $100.00 or less, and there is no additional consideration received by the grantor, R & T 11911.”

14. Conveyance from a Trustee Under a Land Contract at the Consummation of the Contract
“This is a conveyance of equitable title from a trustee, under a land contract, to the vendee at the consummation of the contract, R & T 11911.”

15. Conveyance from Individual(s)/Legal Entity(ies) to Individual(s)/Legal Entity(ies) Where the Grantors and Grantees Are Comprised of the Same Parties, and Parties Continue to Hold the Same Proportionate Interest. (Exception: Dissolution of a Partnership. R & T 11925(b))
“The grantors and the grantees in this conveyance are comprised of the same parties who continue to hold the same proportionate interest in the property, R & T 11925(d).”

To complicate matters, several counties now have a special “Documentary Transfer Tax Affidavit” that needs to be signed “under penalty of perjury” and attached to the Preliminary Change of Ownership form. All these forms have to be attached to that Grant Deed or Quitclaim Deed before the County will accept it for recording.

Here are the counties (as of May, 2011) which have the special “Affidavit” and their requirements:

County All Deeds Signatures Web Address Link Memo
Solano No County does not question signature except on Company to Company transactions Required on all deeds if there is no PCOR
Santa Barbara No Grantor or Grantee only
San Mateo Yes Grantor & Grantee Title Co as agent
San Joaquin No Grant & Grantee or Agent Title Companies excluded as valid agents
San Francisco Yes Grantor & Grantee Gift transaction MUST have original signature and CANNOT be an agent
Riverside Yes County does not question signature
Merced No Grantor or Grantee only
El Dorado No Grantor & Grantee Not required- spousal and into/out of trust. Must show proof of same parties/same interest


The exemption declaration, together with the proper completion of the Preliminary Change of Ownership form, also serves the purpose of notifying the County Tax Assessor’s office that the transfer is not a true purchase/sale transaction and therefore the property taxes should not be re-assessed.

It must be noted that just because the exemption clause and non re-assessment of taxes have been typed on the documents and requested, it can still be disallowed by the government agencies.