Did filing a Florida UCC-1 create documentary stamp tax when the note, security agreement, and other loan documents were executed and kept out of state?

Plain-English summary

Filing the UCC-1 financing statement alone did not trigger Florida documentary stamp tax.

The out-of-state seller and Florida buyers executed the note, security agreement, crop lien, and UCC-1 at the seller's out-of-state office. The note was payable there and was not sold, transferred, or assigned in Florida. Only the UCC-1 was filed in Florida because the collateral was located in the state.

The Department said tax would arise if the note, security agreement, or another obligatory document also was filed or recorded. Even when no tax was due, the UCC-1 needed a notation stating that proper taxes had been or would be placed on the promissory instruments, or that tax was not required.

What this means for you

The ruling distinguished a notice filing from recording the underlying debt instrument. The exact set of documents filed in Florida controlled the stated result.

Common questions

Q: Was filing the UCC-1 alone taxable? A: No.

Q: What would change the result?
A: Filing or recording the note, security agreement, or another obligatory document in Florida.

Q: Was any statement required on the UCC-1? A: Yes. It needed the rule's stamp-tax notation even if no tax was required.

Citations and references

• Fla. Stat. § 201.08(1) — written obligations and recorded security instruments
• Fla. Admin. Code r. 12B-4.053(33) — UCC-1 filing and stamp-tax notation
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 95B4-008

Original ruling text

May 15, 1995

Re: Technical Assistance Advisement No. 95(B)4-008 Documentary Stamp Tax; Filing Of UCC-1 Financing Statement In Florida Securing Out-Of-State Transactions XXX (Taxpayer)

Dear :

This is in response to your recent request for a technical assistance advisement pursuant to s. 213.22, F.S., and Rule 1211.003, F.A.C.

The following is the statement of facts outlined in your letter:

The Taxpayer which is an out-of-state company is selling goods to Florida residents that purchase the goods at the company's office in XXX. As to some of those purchases the company agrees to accept installment payments and the Florida residents sign a note, security agreement, crop lien, and UCC-1 at the company's office in XXX. In other words, the note, security agreement, crop lien, and UCC-1 are made, executed, delivered in XXX. The note is payable in XXX and it is not sold, transferred, or assigned in this state. However, since the company is dealing with Florida residents and the property that is the security for the debt is in this state, the UCC-1's are filed for record in Florida.

The Taxpayer has been purchasing documentary stamps, based upon the amount of the note, each time it has filed a UCC-1.

Requested Ruling

All documents were made, executed, and delivered out-ofstate. Is the filing of UCC-1 Financing Statement with the Florida Secretary of State taxable?

Discussion and Law

Relevant to your petition, s. 201.08(1), F.S., provides that:

On promissory notes, nonnegotiable notes, and written obligations to pay money (hereinafter, called "notes")... made, executed, delivered, sold, transferred, or assigned in the state, and for each renewal of the same, the tax shall be 35 cents on each $100 or fraction thereof of the indebtedness or obligation evidenced thereby. On mortgages, trust deeds, security agreements, or other evidences of indebtedness filed or recorded in this state, and for each renewal of the same, the tax shall be 35 cents on each $100 or fraction thereof of the indebtedness or obligation evidenced thereby.... (emphasis added)

As stated in Rule 12B-4.053(33), F.A.C, the filing or recording of a UCC-1 Financing Statement is not taxable under s. 201.08(1), F.S., unless the note, security agreement or other obligatory document is also filed or recorded. However, a notation relative to stamp tax is required on the UCC-1 Financing Statement whether tax is due or not. The notation shall state that proper stamp taxes under Ch. 201, F.S., have been placed on the promissory instruments and will be placed on any additional promissory instrument, or that tax is not required.

Department's Position

The filing or recording in Florida of a UCC-1 Financing Statement is not taxable under s. 201.08(1), F.S., unless the note, security agreement or other obligatory document is also filed or recorded.

This response constitutes a Technical Assistance Advisement under s. 213.22, F.S., which is binding on the Department only under the facts and circumstances described in the request for this advice as specified in s. 213.22, F.S. Our response is predicated on those facts and the specific situation summarized above. You are advised that subsequent statutory or

administrative rule changes or judicial interpretations of the statutes or rules upon which this advice is based may subject similar future transactions to a different treatment than expressed in this response.

You are further advised that this response and your request are public records under Chapter 119, F.S., which are subject to disclosure to the public under the conditions of s. 213.22, F.S. Your name, address, and any other details which might lead to identification of the taxpayer must be deleted by the Department before disclosure. In an effort to protect the confidentiality of such information, we request you notify the undersigned in writing within 15 days of any deletions you wish made to the request or the response.

Sincerely,

Baldan E. Sulker
Senior Tax Specialist
Technical Assistance

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