Bill > SB33

This bill expands the exemption from recordation and transfer taxes for certain real property transfers between related business entities by including "common law trusts" within the definition of a "business entity." This means that transfers of property between a parent business entity and its wholly owned subsidiary, or between two subsidiaries owned by the same parent, will not be subject to these taxes if the transfer is for no consideration, nominal consideration, or only involves the exchange of ownership interests, and these conditions are met. The bill also clarifies that an "owner" can be a beneficial owner of a business entity or another person as defined in the Corporations and Associations Article, and it specifies conditions under which a subsidiary can transfer property back to its parent and still qualify for the exemption, including a requirement that the parent has owned the subsidiary's ownership interest for over 18 months or that the subsidiary has existed and owned the property for two years. These changes are intended to facilitate reorganizations and transfers within related business structures without incurring additional tax burdens, and they will apply to documents recorded on or after July 1, 2026.

Budget and Finance

https://mgaleg.maryland.gov/mgawebsite/Legislation/Details/SB0033?ys=2026RS