Real Estate Transfer Fee Common Questions - M

Merger

  1. What are the filing requirements for mergers or conversions with an effective date of July 1, 2016 or after, under state law (sec. 73.14, Wis. Stats.)?

  2. What are the filing requirements for mergers or conversions with an effective date prior to July 1, 2016 under state law (sec. 73.14, Wis. Stats.)?

Mineral Rights

  1. Did the Wisconsin Department of Revenue change its requirement of filing a real estate transfer return and fee on mineral and timber rights?

  2. How is the transfer fee calculated on a mineral lease?

  3. When a lease is recorded and a transfer fee is paid for a mineral lease to extract gravel for a future road project, and the road project goes to another contractor, the lease is terminated and all consideration paid is returned according to the lease terms. Is the transfer fee that was paid with the recording of the lease eligible for a refund?

Mobile Homes

  1. A mobile home on a lot (owned by the mobile home owner), on a foundation (including blocks) and hooked to water, sewer and other utilities is sold. Is the conveyance subject to the transfer fee?

  2. A mobile home on a leased site, on a foundation and hooked to water, sewer and other utilities is sold. Is the conveyance subject to the transfer fee?


Merger

  1. What are the filing requirements for mergers or conversions with an effective date of July 1, 2016 or after, under state law (sec. 73.14, Wis. Stats.)?

    There are no filing requirements. Under the 2015 Act 295, the requirement to file the MC-500 Merger Conversion Report required under state law (sec 73.14, Wis. Stats.) was repealed.

  2. What are the filing requirements for mergers or conversions with an effective date prior to July 1, 2016 under state law (sec. 73.14, Wis. Stats.)?

    If an acquired business entity in a merger (or the converted business entity in a conversion) had a fee simple ownership interest in any Wisconsin real estate immediately before the merger (or conversion), the surviving business must submit the MC-500 Report to the Wisconsin Department of Revenue no later than 60 days after the effective date of the merger (or conversion). Failure to file the report within the timeframe, or to specify each of the municipalities affected, results in penalties under state law (sec. 73.14(2), Wis. Stats.). It is optional to record deeds changing title to the property with the county Register of Deeds.

    • Provides information on the name/ownership change so record title and the address for future tax bills can be updated for the property(s) listed

    • New owner's name is listed under the "Surviving Entity." The tax bill should be sent to the new owner at the address listed in the property description section.

    • If a tax bill address is not specified in the property description section, the tax bill should be sent to the person authorized to submit the report, which is located at the bottom of the report

    • Located on our website at: ww2.revenue.wi.gov/internet/merger.html

    Note: Under state law (sec. 73.14(2)(a), Wis. Stats.), you will be charged a $200 penalty for each day the report is late, not to exceed $7,500.

Mineral Rights

  1. Did the Wisconsin Department of Revenue change its requirement of filing a real estate transfer return and fee on mineral and timber rights?

    No. Our position is the same. Whenever there is a conveyance of mineral or timber rights, an electronic real estate transfer return is required since it is a conveyance of real estate per state law (sec. 77.21(1m), Wis. Stats.). A transfer fee is required unless specifically exempt from fee under sec. 77.25, Wis. Stats.

    Note: Any type of document, lease, assignment of lease, deed or any other instrument conveying a mineral or timber interest is subject to transfer return and transfer fee unless specifically exempt from fee under sec. 77.25, Wis. Stats.

  2. How is the transfer fee calculated on a mineral lease?

    The transfer fee is calculated on the amount of the full actual consideration paid or to be paid, per state law (sec. 77.21(3) (a), Wis. Stats.).

    Examples of a gravel lease for calculating the fee when the lease is signed:

    • Single Payment - when the lease is paid by a single payment based on an estimate of what will be extracted with no future payments or royalties, you must submit a transfer return and fee based on the single payment amount. If the amount of what is extracted exceeds the value originally reported, you must file an "Amended Real Estate Transfer Return" to report the additional consideration and pay the additional transfer fee due.

    • Royalty/installment - when the amount of gravel to be extracted is unknown, and you only make a down payment with future royalties or other types of future payments to be made based on extraction, the fee is initially imposed on the down payment when the document is recorded. When additional payments are made, you must file an "Amended Real Estate Transfer Return" to report the additional consideration paid for each payment.

    • No payment/consideration - when there is no down payment or other consideration paid when the lease is recorded and only royalties or other type payments are to be made based upon extraction, on the transfer return, you may use exemption sec. 77.25(13), Wis. Stats., as a conveyance of real estate having a "value of $1,000.00 or less." When additional payments are made, you must file an "Amended Real Estate Transfer Return" to report the consideration paid for each payment.

  3. When a lease is recorded and a transfer fee is paid for a mineral lease to extract gravel for a future road project, and the road project goes to another contractor, the lease is terminated and all consideration paid is returned according to the lease terms. Is the transfer fee that was paid with the recording of the lease eligible for a refund?

    Yes. Since the lease was terminated without any gravel being taken and no consideration given, Exemption (13) can be used. Complete an "Amended Real Estate Transfer Return" located at: ww2.revenue.wi.gov/internet/pe-500x.html. Since the transfer fee is assessed against the grantor per state law (sec. 77.22, Wis. Stats.), refunds are issued to the grantor unless specifically requested otherwise.

    Note: All claims for refund must be made within four years of the date the mineral lease is recorded per sec. 77.26(3), Wis. Stats.

Mobile Homes

  1. A mobile home on a lot (owned by the mobile home owner), on a foundation (including blocks) and hooked to water, sewer and other utilities is sold. Is the conveyance subject to the transfer fee?

    The mobile home is classified as real estate and subject to fee when the mobile home is on land owned by the homeowner, on a foundation (includes blocks) and hooked to utilities. It would be considered personal property if any of the above three requirements were not met.

  2. A mobile home which is on a leased site, on a foundation and hooked to water, sewer and other utilities is sold. Is the conveyance subject to the transfer fee?

    Yes. Even though a mobile home is defined per sec. 70.043(2), Wis. Stats., as personal property for property tax purposes per state law (sec. 77.21(1m), Wis. Stats.), real estate includes improvements on leased land for transfer fee purposes.

    Note: A transfer fee is not due if you complete and submit the mobile home's title to the Department of Transportation to convey title to the new owner.

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