§ 17-5. Taxable basis.

(a) "Taxable basis" defined.

Except as otherwise provided in this section, "taxable basis" means the cash consideration and the value of any other consideration paid or agreed to be paid for the property transferred, including the amount of any liens or encumbrances on the property other than current property taxes and other municipal charges.

(b) Documentation.

(1) The cash consideration plus the value of any other consideration paid or agreed to be paid for the property, including the amount of liens or encumbrances on the property, shall be stated in a written affidavit, made on personal knowledge of the affiant and under penalties of perjury, on forms to be furnished by the Director of Finance.

(2) The Director of Finance may not accept the affidavit unless it is accompanied by written proof of the purchase price for the property. This proof shall include a copy of the settlement sheet, contract of sale, or other document the Director of Finance finds adequate.

(3) The affidavit and accompanying documents shall be filed with the Director of Finance at the time that the tax is paid.

If any part of the consideration paid or agreed to be paid for the property consists of anything other than (i) cash paid or agreed to be paid or (ii) the amount of liens or encumbrances on the property,"taxable basis" means the greater of:

(1) the consideration stated in accordance with subsections (a) and (b) of this section; or

(2) the full cash value of the property, as most recently determined by the State Department of Assessments and Taxation.

(d) Consideration other than cash, etc. – Transfer of ground rent.

For a transfer of a perpetually renewable ground rent, if any part of the consideration paid or agreed to be paid consists of anything other than (i) cash paid or agreed to be paid or (ii) the amount of liens or encumbrances, "taxable basis" means the greater of:

(1) the consideration stated in accordance with subsections (a) and (b) of this section; or

(2) either:

(i) the redemption value of the ground rent, if redeemable; or

(ii) if irredeemable, the capitalization at 5% of the ground rent.

(e) Leases not perpetually renewable.

(1) For a lease for a term above 7 years, not perpetually renewable,"taxable basis" means the capitalization at 10% of the average annual base rental for the property over the entire term of the lease, including all renewal terms, plus the cash consideration and the value of any other consideration paid or agreed to be paid, other than the base rent.

(2) If the average annual rental cannot be determined at the time of recording the lease or the attornment agreement, memorandum of lease, assignment of lease, or other instrument intended to give notice of the lease, or if any part of the consideration paid or agreed to be paid for the rental of the property consists of anything other than cash paid or agreed to be paid, the value of which cannot be readily determined, then in either case:

(i) the stipulated cash base rental (excluding indeterminable items of every kind, such as percentage of sales, taxes, maintenance, and repair costs and utilities) shall be used as the basis for tax computation; and

(ii) "taxable basis" means the greater of:

(A) the minimum average annual rental ascertainable from the terms of the lease, plus 5% of the minimum average annual rental, the whole to be capitalized at 10%, plus any consideration paid or agreed to be paid, other than rent; or

(B) the full cash value of the property, as most recently determined by the State Department of Assessments and Taxation.