Thursday, January 28, 2010

Baltimore Sun: Anne Arundel reverses decision on taxing short sales

As we reported here on January 8th, several counties, including Anne Arundel County, had decided to use unpaid principal mortgage balance rather than sales price as a basis on which to assess recordation taxes. Naturally, this decision was largely condemned by the Maryland real estate and taxpayer community.

Today the Baltimore Sun reports that Anne Arundel has backed down from this practice, citing an opinion from the Maryland Attorney General that the "practice isn't supported by state law." The full article can be found here. The county will instead assess recordation tax on the sales price as it previously had.

Montgomery County had also attempted to implement a similar taxing scheme, but backed down shortly after announcing it.

This is great news not only for Maryland tax payers and real estate practitioners, but also for folks everywhere. The American Land Title Association was closely monitoring the situation here in Maryland, as a successful implementation of this by one or more counties could have encouraged others to do the same.