December 11, 2009
Taxation Alerts

"Prop 13"- New Rule For Legal Entities that have a Change in Ownership
by Bridget McInerney Harris

Effective January 1, 2010 any entity involved in a merger, acquisition or other transaction that is characterized as a Prop 13 change in ownership must file a BOE Form 100-B within 45 days of the transaction or be penalized 10% of the entity's annual property tax on the reassessed values. Form 100-B "Statement of Change in Control and Ownership of Legal Entities" provides information on all California real property that is owned by the entity. The change requires self-reporting where previously a penalty was imposed 45 days after the BOE requested the information. A change in ownership includes the cumulative transfer of more than 50% of the original ownership interests which could trap entities that have been gradually making transfers.
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