Laws, Regulations & Annotations

P

625.0000 PARENT-CHILD TRANSFER

Annotation 625.0153

625.0153 Partnership. Mother owned real property in which she gave a 10 percent interest to her daughter. Such transfer qualified for the parent/child exclusion under Revenue and Taxation Code section 63.1. Subsequently, mother and daughter transfer their respective interests in the real property to a partnership in exchange for the same proportional ownership interests in the partnership. Such transfer was excluded from change in ownership under Revenue and Taxation Code section 62(a)(2). Thereafter, mother transferred a 50 percent interest in the partnership to her daughter. Since the daughter obtained a majority interest (60 percent) in the partnership as a result of the transfer, the partnership underwent a change in control under Revenue and Taxation Code section 64(c)(1). The transfer of interests in a legal entity does not qualify for the parent/child exclusion because section 63.1 excludes only certain transfers of real property between parents and children. Pursuant to section 63.1(c)(3), real property does not include legal entity interests. C 6/22/2007.