Brian Funk’s Unofficial Guide to the Universe for Delaware Settlement Attorneys on the New Delaware Form 5403 for Non-Resident Withholding on Sale of Real Estate
What is the purpose of withholding income tax on the sale of real property on non-residents? Income tax is imposed on gain from the sale of real property (unless it’s exempt). In English, the gain is calculated by taking the amount realized and subtracting it from the adjusted basis. It’s obviously harder for Delaware to collect from folks who live out-of-state (than those in-state) so we’re now being required to collect an estimated payment at the time of settlement. It’s important to remember that this is a Delaware law—and it has nothing to do with the separate, federal Foreign Investment
INTESTATE Heirs Selling Real Estate
Delaware Heirs Selling Real Estate when the Decedent Died Without a Will (Guidance from a Settlement Attorney): Unlike some states, in the State of Delaware, when a person died as the sole owner of real estate and died without a Last Will & Testament (i.e. the person died intestate), the estate itself is NOT the seller in a sale (subject to a limited exception discussed below that requires a court order). When a person dies intestate, under Delaware law, then all the heirs are required to come together and agree to sell that real estate. For most estates where you
September 2020 Real-Estate Section Meeting
The agenda for the September 9, 2020 DSBA Real-Estate Section Meeting is attached here. Please remember this is a ZOOM/Call-In meeting. September-2020-Real-Estate-Section-Meeting-AgendaDownload
City of New Castle’s New First-Time Home Buyer (FTHB) Transfer-Tax Exemption for its Downtown Development District
The City of New Castle has created a first-time home buyer (FTHB) transfer tax exemption program limited to residential properties within its specifically designated Downtown Development District (DDD). If the property is within the DDD of the City of New Castle, the standards to qualify mirror the State of Delaware’s own FTHB standards . You are encouraged to call the City of New Castle at 302-322-9801 to verify a property’s eligibility. I have attached the ordinance creating it in October 2019 and the map of the DDD below. Map-of-City-of-New-Castles-Downtown-Development-DistrictDownload Map-of-City-of-New-Castles-Downtown-Development-DistrictDownload City-of-New-Castle-FTHB-Affidavit-for-Borrower-and-Lender-to-SignDownload 12-27-2019-Cover-Letter-from-Solicitor-of-the-City-of-New-CastleDownload
Delaware’s New Mandatory Withholding of Estimated Income Tax for Non-Residents on Real Estate Transactions on Form 5403 (starts 1/1/2019)
“To all my Delaware settlement attorney friends, I wanted to share my notes from the past year of meetings, conference calls, and the special 1-hour CLE seminar in October 2018 on the changes taking place on 1/1/2019 for the Form 5403. If you have any comments or suggestions, I’d love to hear them as I’m trying to make this as simple as possible without us all becoming CPAs on the side.” Brian Funk’s Unofficial Guide to the 2019 Delaware Form 5403 Non-Resident Withholding Changes (11-14-2018) 2019’s Delaware Form 5403 Brian Funk’s Unofficial Guide to the Universe for Delaware Settlement Attorneys
Presentation on Enhancements to New Castle County Parcel View for Delaware Settlement Attorneys
Attention Delaware Settlement Attorney Friends: Paula Marsilii of New Castle County is going to give us a presentation on the enhancements to the New Castle County’s Parcel View website at 3:30pm on 11/14/2018 and our monthly Section meeting will follow at 4:00pm. For settlement attorneys, Ms. Marsilii is the official that our offices interact with daily when dealing with lien inquiries and code violations. Ms. Marsilii will show us how most of the information that we have traditionally sought with a fax inquiry is now available entirely online. My thought is that the Section may also have some feedback to
COUNTERFEIT CHECK FRAUD IS ON THE RISE!
If you have never been to our office in Newark, Delaware for an actual settlement and you receive a check that purports to be from us, please call our office number at 302-368-6233 to verify it. (We have had the same phone number and office address for 28 years so that phone number is easily verifiable through third parties).
Delaware’s First-Time Homebuyer Transfer-tax discount/credit
On 8/28/2018, Delaware officially adopted a statewide first-time homebuyer transfer-tax discount/credit that is retroactive back to settlements that occurred on or after 8/1/2017 —where the buyer paid the *increased* transfer tax—that took effect in August 2017. It’s important to realize that this discount applies to all residential homes in the entire state—including municipalities like Town of Middletown or City of Newark—that do not generally offer such a discount for properties within their limits. If my office handled your settlement and you purchased your first home, please give my office a call and we’ll mail you the form to sign and
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