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Page 4 TP-584.1 (11/09)

located in New York State that is owned by the entity and the denominator is the

b. Computation of Tax on Conveyance Less Credit

fair market value of all assets owned by the entity.

Consideration Paid by Y

$500,000

Line 28 — Enter the fair market value of the real property as of the date of

Transfer Tax ($2 for each $500 of consideration)

$2,000

conveyance multiplied by the percentage in the entity being transferred or

Less credit for tax previously paid

– 453

acquired.

Total tax due on current conveyance

$1,547

Line 29 — Enter the amount from line 27 or line 28, whichever is less. This is

Line 35 — Enter the amount of consideration the grantor is not entitled to

the amount of consideration to be entered on Form TP-584, Schedule B, Part I,

receive after the conveyance. This amount is the present value of the remaining

line 1.

net rental payments, included in the taxable consideration on the leasehold

grant, that will not be received as a result of the present conveyance.

Schedule F

Line 36 — Enter the amount of the taxable consideration originally used in

Section 1405(b)6 of the Tax Law provides exemption from the real estate transfer

computing the tax on the leasehold grant.

tax to the extent a conveyance consists in whole or in part of a mere change

Line 37 — Enter the percentage of credit to be applied to the tax on the

of identity or form of ownership or organization where there is no change in

beneficial interest.

conveyance of the real property by dividing line 35 by line 36. Round the

percentage to four decimal places.

To determine the consideration for the conveyance, multiply the fair market value

of the real property at the time of conveyance by the percentage of interest not

Line 38 — Enter the amount of transfer tax paid by the grantor on the prior

subject to the mere change exemption.

leasehold grant or on the granting of an option or contract to purchase all or a

portion of the same real property. Attach a copy of the original Form TP-584 filed

Generally, the fair market value of the real property is to be determined by

and proof of payment.

appraisal. It is the amount a willing buyer would pay a willing seller for the real

property. It is not the net fair market value, which deducts mortgages on the

Line 39 — Multiply line 37 by line 38. This is the amount of credit to be applied

property from fair market value.

to the tax on the current conveyance. Enter this amount on Form TP-584,

Schedule B, Part I, line 5.

When determining the taxable consideration, the consideration may be reduced

by the amount of continuing liens remaining on the property at the time of

Part

conveyance multiplied by the percentage of interest not subject to the mere

A credit will be allowed upon the original conveyances of shares of stock in

change exemption. Please refer to Page 2 of Form TP-584-I for additional

a cooperative housing corporation in connection with the grant or transfer of

information on the continuing lien deduction.

a proprietary leasehold by the cooperative corporation or cooperative plan

Example: B owns real property with a fair market value of $2 million. B conveys

sponsor, provided the first conveyance of shares of stock takes place within

the property to a partnership in exchange for a 30% interest in the partnership’s

24 months from the conveyance of the real property to the cooperative housing

assets. Although B has conveyed all of the real property to a partnership, he is

corporation. The credit is limited to the proportionate part of the tax paid when

entitled to a mere change exemption from the tax to the extent of his interest

the real property was conveyed to the cooperative housing corporation, to the

in the partnership. The consideration for the conveyance will be deemed to be

extent that the conveyance would have otherwise resulted in a mere change

$1,400,000 ($2,000,000 multiplied by the interest not subject to the mere change

of identity or form of ownership of the property with no change in beneficial

exemption).

ownership.

Line 30 — Enter the fair market value of the real property at the time of the

The credit is determined by multiplying the amount of tax paid upon the

conveyance. Attach evidence to support the fair market value.

conveyance of the real property to the cooperative housing corporation by the

percentage that represents the extent to which the conveyance would have

Line 31 — Enter the percentage that represents the change in beneficial

resulted in a mere change of identity. The resulting product is then multiplied by

ownership. Round the percentage to four decimal places.

a fraction. The numerator is the number of shares of stock conveyed when the

Line 32 — Multiply line 30 by line 31. This is the consideration for the

proprietary leasehold was granted or transferred; the denominator is the total

conveyance. Enter this amount on Form TP-584, Schedule B, Part I, line 1.

number of shares of stock of the cooperative housing corporation. In no event

Line 33 — Enter the proportionate amount, if any, of the continuing lien

will the credit reduce the tax on the conveyance below zero.

deduction. The proportionate amount of continuing liens means the amount of

Line 40 — Enter the number of shares allocated to the unit(s) for which

any continuing lien multiplied by the percentage not subject to the mere change

proprietary leasehold(s) are being granted.

exemption. Enter this amount on Form TP-584, Schedule B, Part I, line 2. A

Line 41 — Enter the total number of shares of stock in the cooperative housing

continuing lien is a mortgage or lien on the real property assumed or taken

corporation.

subject to and not an acquisition mortgage or lien placed on the real property by

the grantee upon acquisition of the real property. See page 2 of Form TP-584-I

Line 42 — Divide line 40 by line 41. Round the percentage to four decimal

for additional criteria that must be met to claim the continuing lien deduction.

places. This is the percentage of credit to be applied to the tax paid on the

conveyance to the cooperative housing corporation.

Line 34 — Subtract line 33 from line 32. This is the taxable consideration. Enter

this amount on Form TP-584, Schedule B, Part I, line 3.

Line 43 — Enter the amount of transfer tax paid on the conveyance of the real

property to the cooperative housing corporation. Attach a copy of the original

Schedule G, Part

TP-584 filed and proof of payment.

A grantor will be allowed a credit against the real estate transfer tax on the

Line 44 — Enter the percentage of interest that would have qualified as a

conveyance of real property, but only to the extent that the tax was paid by the

mere change when the real property was conveyed to the cooperative housing

grantor on a prior leasehold grant of all or a portion of the same real property or

corporation. See the instructions for completing Schedule F (this form) for

on the granting of an option or contract to purchase all or a portion of the same

information on a conveyance that would qualify as a mere change of identity.

real property, by the grantor.

Round the percentage to four decimal places.

The credit is computed by multiplying the tax paid on the leasehold grant or the

Line 45 — Multiply line 43 by line 44.This is the proportionate amount of the

granting of the option or contract to purchase by a fraction. The numerator of

tax paid on the conveyance of the real property to the cooperative housing

the fraction is the value of the consideration used to compute the tax previously

corporation that would have otherwise qualified as a mere change.

paid that the grantor will not be entitled to receive after the conveyance of the

Line 46 — Multiply line 42 by line 45. This is the amount of credit to be applied

real property. The denominator is the total value of the consideration used to

to the tax due on the conveyance of the unit(s) for which the proprietary

compute the tax previously paid.

leasehold(s) is being granted. Enter this amount on Form TP-584, Schedule B,

Example: Z enters into a lease with Y for a term of 5 years with an option to

Part I, line 5.

purchase the real property in any year throughout the term of the lease. The

Example: Taxpayer A conveyed a 100-unit apartment building to a cooperative

annual rent for the term of the lease is $50,000. Since this conveyance consists

housing corporation (CHC) on January 1, for a consideration of $5 million and

of an option conveyed with use and occupancy, the present value of the rental

paid transfer tax of $20,000 ($2 for each $500 of consideration). Taxpayer A

payments for the term of the lease is subject to transfer tax.

receives 1,000 shares from the CHC (10 shares allocated to each unit).

For purposes of this illustration, assume the taxable consideration for the

On February 1, Taxpayer A conveys Unit 1A to Taxpayer B for $100,000.

conveyance is $189,540.

The credit is computed as follows:

Therefore, at a rate of $2 for each $500, or fractional part of the taxable

consideration, the transfer tax on the leasehold grant is $760.

32. Number of shares allocated to the unit conveyed

33. Total number of shares of stock in CHC

1,000

In the second year, Y exercises the option to purchase the real property for

34. Percentage of credit to be applied

.0100

$500,000. The present value of the consideration for the three remaining years of

35. Tax paid on conveyance to CHC

$20,000

the lease is $113,040.

36. Percentage of interest that would have qualified as a

The applicable credit and tax on the conveyance of the property is computed as

mere change to CHC

100%

follows:

37. Proportionate amount of tax paid on conveyance

$20,000

a. Credit Computation

38. Amount of credit to be applied to tax on

conveyance of Unit 1A ($20,000 x .0100)

$200

Value of Consideration Z

Transfer Tax Paid

is not entitled to receive

Amount of credit

Information and assistance

Taxable Consideration

If you need help, call (518) 457-5181; in-state callers with free long distance call

$760

$113,040

$453

1 888 698-2914.

$189,530

Form Tp-584.1 - Real Estate Transfer Tax Return - Supplemental Schedules - New York State Department Of Taxation Page 4

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