Real Estate Transfer Fee Common Questions - A

Adverse Possession

If a court ordered judgment awards the plaintiff's property due to adverse possession, does this need a transfer return?

Agent

  1. When am I required to complete the agent section of the transfer return?

  2. If the grantor is an entity (ex: trust, LLC, partnership), do I need to complete the agent section of the return?

Agent to Principal

Buyer A and Buyer C intend to purchase two adjacent lots from Seller B. Because A and C do not want B to know that C is buying lot 2, A enters into a purchase agreement to buy the two adjacent lots from B and immediately transfer lot 2 to C. Can a transfer fee be avoided on the conveyance from A to C?

Air Rights/Aviation Easement

  1. Is there a fee due on the sale of "air rights" over land?

  2. Is there a transfer fee due on the sale of an "aviation easement"?


Adverse Possession

If a court ordered judgment awards the plaintiff's property due to adverse possession, does this need a transfer return?

Yes. An action of adverse possession or "quiet title" is referred to as a declaration of interest in real property. This legal action is a correction to clarify existing property interests and is exempt from a transfer fee under state law (sec. 77.25(3), Wis. Stats.) (Exemption 3). The previous document that is being corrected, is the document where the grantee originally took title to the real estate or claimed to have an interest in the real estate.

Agent

  1. When am I required to complete the agent section of the transfer return?

    Whenever the grantor or grantee is not an individual, the agent section must be completed (ex: Sheriff, Fiduciary). Enter the information of the person signing the documents for the grantor and person accepting the documents for the grantee. For a trust, enter the trust name as grantor or grantee and the trustee for the agent. When there is more than one entity grantor or grantee and they each have different agents, enter the data for the first grantor or grantee listed. If the agent for the grantor and grantee is different, enter the grantor's agent on the return and list the grantee's agent information on the Legal Description Page of the eRETR. If Wisconsin Department of Revenue has questions about the conveyance, we must be able to directly contact the person familiar with the conveyance. A generic phone number or address of an entity is not sufficient.

  2. If the grantor is an entity (ex: trust, LLC, partnership), do I need to complete the agent section of the return?

    Yes. The person signing for the entity must complete the grantor agent portion of the return.

Agent to Principal

Buyer A and Buyer C intend to purchase two adjacent lots from Seller B. Because A and C do not want B to know that C is buying lot 2, A enters into a purchase agreement to buy the two adjacent lots from B and immediately transfer lot 2 to C. Can a transfer fee be avoided on the conveyance from A to C?

If A and C have an agency agreement between them, this is an "agent to principal" transaction and could be exempt from fee under state law (sec. 77.25(9), Wis. Stats.). The use of Exemption (9) also requires the conveyance to be for "no consideration." If A transfers lot 2 immediately after taking title from B and does not benefit from having held title other than be compensated for their time for being involved with the transactions, then Exemption (9) would apply.

Air Rights/Aviation Easement

  1. Is there a fee due on the sale of "air rights" over land?

    Yes. The sale of air rights is a sale of real estate as defined under state law (sec. 77.21(1), Wis. Stats.), and is subject to transfer return and fee. The definition under sec. 990.01(35), Wis. Stats. and 63 Am. Jur. 2d Property § 14, states: land extends from the surface downward to the center of the earth and upward indefinitely to the skies. Modern courts have recognized that this must be balanced with the right of flight.

  2. Is there a transfer fee due on the sale of an "aviation easement"?

    • No. An "aviation easement" just grants the "right-of-flight" and the "right to restrict…" to the grantee (airport) - not "possession" by the grantee

    • Since it is not a conveyance of a real property interest as defined under state law (sec. 77.21(1) & (1m), Wis. Stats.), it is not subject to:

      • Filing a transfer return imposed under state law (sec. 77.22(1), Wis. Stats.)

      • A transfer fee imposed under state law (sec. 77.22(1), Wis. Stats.)

    • To exempt an aviation easement from transfer return and transfer fee, include the following language below the legal description:
      "This is the sale of an aviation easement only and is therefore not a conveyance as defined by state law (sec. 77.21(1), Wis. Stats.), and is exempt from transfer return and fee imposed under state law (sec. 77.22(1), Wis. Stats.)."

FOR MORE INFORMATION CONTACT:

MS 6-97
WISCONSIN DEPARTMENT OF REVENUE
Local Government Services Bureau
PO Box 8971
Madison, WI 53708-8971
Phone: (608) 264-6885 or (608) 266-1594
Fax: (608) 264-6897
Email additional questions to DORERealEstateTransfer@wisconsin.gov

​May 4, 2016