Did a deed transferring real property from a general partnership to the same partnership after conversion to a limited partnership owe more than minimum documentary stamp tax?

Plain-English summary

Florida ruled that only minimum documentary stamp tax was due on the deed required when a general partnership converted into a limited partnership, provided the conversion satisfied section 620.8902.

Although section 620.8904 required the real property to be transferred by deed to the converted partnership, the statute also treated the converted partnership as the same entity that existed before the conversion. The Department therefore found no conveyance from one entity to another.

What this means for you

The result depended on completing the statutory partnership-conversion process. It did not announce a general minimum-tax rule for any deed between related partnerships.

Common questions

Why was only minimum tax due? The converted limited partnership was legally the same entity as the general partnership that already owned the property.

Did the property still need a deed? Yes. The ruling said section 620.8904(2)(a) required title to be transferred by deed to the converted partnership.

Would the result apply without a qualifying statutory conversion? The ruling did not say so. Its holding expressly depended on meeting all requirements of section 620.8902.

Citations and references

• Fla. Stat. § 201.02(1)
• Fla. Stat. § 620.8902
• Fla. Stat. § 620.8904(1), (2)(a)
• Fla. Stat. § 213.22

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 99B4-003

Original ruling text

SUMMARY

The converted limited partnership is treated, for all
purposes, as the same entity that existed before the
conversion. Thus, the deed, does not convey the real
property interest from one entity to another. If all the
requirements of section 620.8902, F.S., are met, only
minimum tax is due on the deed resulting from a conversion
of the general partnership to a limited partnership
pursuant to s. 620.8904(1), F.S.

Feb 15, 1999

Re: Technical Assistance Advisement No. 99(B)4-003
Documentary Stamp Tax; Deed Pursuant to Partnership
Conversion
Sections 201.02 and 620.8904, F.S.
XXX (hereinafter Taxpayer)

Dear :

Your letter requesting a Technical Assistance Advisement
has been referred to this office for response. The specific
scenario for which advice has been requested is summarized
below.

Facts Presented by Petitioner

The partners desire to convert the general partnership to a
limited partnership pursuant to s. 620.8904, F.S. The general
partner of the limited partnership will be a corporation. The
general partnership owns real property which will be transferred
to the limited partnership.

Request for Advisement

You request a ruling that the deed from the general
partnership to the limited partnership requires only minimum

documentary stamp tax.

Provisions of Law

Section 201.02(1), F.S., imposes an excise tax on any
instrument that conveys an interest in Florida real property.

Section 620.8902, F.S., provides for conversion of a
partnership to a limited partnership. The section sets forth
requirements to effect the conversion.

Section 620.8904(2)(a), F.S., provides that title to all
real property owned by a converting partnership must be
transferred by deed to the converted partnership. Section
620.8904(1), F.S., provides that a partnership that has been
converted pursuant to s. 620.8902, F.S., is for all purposes the
same entity that existed before the conversion.

Position of the Department

The converted limited partnership is treated, for all
purposes, as the same entity that existed before the conversion.
Thus, the deed, does not convey the real property interest from
one entity to another. If all the requirements of section
620.8902, F.S., are met, only minimum tax is due on the deed
resulting from a conversion of the general partnership to a
limited partnership pursuant to s. 620.8904(1), F.S.

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,

Celestine Grantham
Senior Tax Specialist
Technical Assistance and Dispute Resolution
Office of General Counsel

CG/mh