DCLTA Meeting with Recorder of Deeds and Office of Tax and Revenue Regarding Homestead Tax Reduction Concerns
Several members of the DC Land Title Association Board of Directors met with senior members of the District of Columbia’s Recorder of Deeds Office, Assessment Services Division and Office of Tax and Revenue (OTR) on December 13, 2023 to discuss concerns the industry is having related to the filing of the Homestead/Senior Tax Exemption application. In the way of background, in 2020, the OTR’s Homestead Unit implemented a new policy with required the mandatory electronic filing of the Homestead Deduction, Disabled Senior Citizen and Disabled Property Tax Relief Application (ASD-100) This change went into effect as of October 1, 2021.
DCLTA Vice President Chris Darby began the discussion by pointing out some general areas concern title companies are experiencing with this transition from submitting a hard copy of the ASD 100, filled out at closing by the buyer to the new requirement that it be submitted electronically through an OTR portal. This new process requires that the buyer submit this application Post-Closing, outside of the closing table. Given the general overwhelming nature of a real estate closing, we suspect that there are many buyers simply forgetting to submit these applications online when they leave the settlement company office.
In response to this concern, Frank Bessenyei, the Division Chief for Assessment Services at OTR suggested that perhaps his office put together a one pager to be provided to the buyers at closing and included in the hard copy of closing docs they take home. This document would provide step by step instructions on how to apply for the homestead/senior citizen and/or disabled property tax relief application, along with further detail regarding the time frame the buyer can expect to see their application either approved or denied and other relevant information association with the new filing system. The industry acknowledged that for many title companies this is already taking place but acknowledged the value in their being a standardized set of instructions, crated by OTR for all title companies to provide to their buyers.
The next issues brought to the attention of the District staff is the requirement found in the D.C. statute that a copy of the Homestead Application and proof of its submission be attached to the FP7-C at the time of recording when the buyer is a first time DC homebuyer and applying for the reduced Recordation Tax Rate provided to these individuals. Ida Williams, the Recorder of Deeds, reminded the industry representatives that in addition to submitting the hard copy of the application, they must also file the ASD-100 electronically with the Homestead office. Ida indicated that there is some evidence of these not being recorded electronically when auditing taxpayers accounts and reviewing whether the applications are getting filed.
It was suggested that we remind our members as to what exactly is required when presenting the Reduced Recordation Tax Rate for First-Time Homebuyers Application (Form ROD 11) and FP7-C at the time of recordation. The current mandate is that ROD will require only the following documents:
Additionally, it was advised that the deed must be recorded within a few business days of the electronic homestead application in order to avoid the risk of that the buyers homestead application will be denied due to the deed being presented for recordation weeks later.
Kevin Anderson, President of DCLTA, next discussed the issue being found when conducting closing of newly created condominium conversion projects. In this case, while the OTR has issued new 2000 lot numbers for the unit units, it is taking weeks to months before these lot numbers become visible on the OTR website. It then becomes impossible to file a Homestead Application until such time as the lot numbers become visible in the OTR system.
Frank Bessenyei, provided the solution to this issue (though it won’t be available until October of 2024). The District is currently working on a major upgrade to their operating system, called Core 21. This new system will provide that any new lot numbers issued by OTR, such as the new condominium lot numbers issued once a project is completed, be instantaneously visible to the public on the OTR online system, www.mytaxdc.gov. While this will certainly resolve this aspect of the Homestead credit, Kevin pointed out that while this is a great and welcome change in DC reporting capability, we still have 12 months to develop an alternative to the current solution. Currently, either the tile company or the buyer are required to monitor the OTR website until such time as the lot numbers become visible at which point the buyer may submit their Homestead application electronically. Given the potentially lengthy time span from the date of closing until the time the lot numbers become visible, Frank suggested a separate meeting with Kevin Anderson and anyone else interested in this issue to try to develop a temporary solution to this problem.
Chris Darby and Katie Griffin brought up the final issue discussed in the meeting and that being the audits associated with the Homestead Tax Reduction. Among other aspects of the audit process, a conversation was had regarding the ordering by title companies of Tax Certificates as part of a settlement and exactly what assurances we as an industry can derive from that document. Frank Bessenyei, offered to have a more in depth conversation with Chris Darby and any others in the industry to discuss these audits in more detail and possible solutions to some of the concerns we see as a result of these audits.
The meeting closed with a comment and suggestion from Frank Bessenyei, that we schedule these types of meetings on a regular basis (quarterly perhaps) allowing for both the industry and DC Government discuss any ideas, concerns or issues being realized by both groups. success being that to have the most effective partnership between the industry and DC Government
Should you have question or comments regarding this important meeting, please contact either Mark Bennett, the DCLTA Executive Director at mark@bennett-management-llc.com or 614-579-2630 or Kevin D. Anderson the DCLTA President at kanderson@standardtg.com or 202-888-0132.
NOTICE TO MEMBERSREVISED*NOW Effective August 1, 2023*District of Columbia’s Recorder of Deeds (ROD) offices will begin extensive renovations fromAugust 2023 through May 2024
NOTICE TO MEMBERS
REVISED
*NOW Effective August 1, 2023*
District of Columbia’s Recorder of Deeds (ROD) offices will begin extensive renovations from
August 2023 through May 2024
The D.C. Office of Tax and Revenue (OTR) recently issued a notice that; effective August 1, 2023 the OTR Building (Floors 5-7) will undergo extensive renovations which will include the Recorder of Deed’s offices. During the renovations the ROD offices will be closed to the public from August 2023 through May of 2024.
The ROD will not be able to process paper recordings during this period. All documents for recording should be submitted electronically through one of the ROD approved e-filing vendors.
For the list of approved vendors, please visit the DC Recorder of Deed’s website at: https://otr.cfo.dc.gov/service/otrrecorder-deeds
If you have any specific recording questions these may be addressed directly to Ida Williams, the Recorder of Deeds by phone at (202) 442-8610 or via email at Ida.williams@dc.gov
DISTRICT OF COLUMBIA GOVERNMENT
RECORDER OF DEEDS
1101 4th Street, SW, 5th Floor
Washington, DC 20024 (202) 727-5374
Please note: the Real Property Tax Service Center, Suite 270 West, will remain open during the initial stages of construction.
Should you have questions or require assistance with implementing electronic recordings, please contact your underwriter.
LEARN MORE HERE
The District of Columbia Office of Tax and Revenue on April 26, 2023 posted
OTR TAX NOTICE 2023 -03
NOTICE REGARDING THE TAXATION OF INSTRUMENTS RELATING TO REFINANCES AND MODIFICATIONS
This Notice Replaces and Supersedes ORT Tax Notice 2014-05 (dated May 21, 2014)
This notice supplements and supersedes OTR Tax Notice 2014-05 on commercial refinances and modifications to provide more clarification on what constitutes a refinance for recordation tax purposes. Generally, to constitute a refinance, the new loan must be made to the same obligor(s) who wasindebted under the loan(s), as modified and restated, if applicable, that is being paid off,extinguished, and replaced, and must be secured by the same real property that securedthe loan(s), as modified and restated, if applicable, being paid off, extinguished, and replaced.
The revised tax notice is published on Recorder Of Deeds website and OTR’s Tax Law and Guidance – Notices.
Review Full Text of Notice
OTR TAX NOTICE 2023-03
For additional information, please call ROD’s Customer Service Center at (202) 727-5374 or contact Ida Williams; Direct phone: (202) 442-8610; ida.williams@dc.gov
Dear Members
As we welcome the start of spring, I encourage you to celebrate the purpose and value in what you do and what we do. DCLTA is the only organization that represents the title industry at the local level in the District of Columbia.
DCLTA liaisons with government officials. Backed by the strength of our membership, DCLTA advocates for sensible laws and policies that improve not only the business landscape for the title industry but allow for the transfer and marketability of title for DC properties.
Employing the richness of our resources, DCLTA educates it members. In addition to educational opportunities, networking with other DCLTA members is invaluable. DCLTA is a place for professional growth. You each have a wealth of knowledge and experience to share.
Of utmost importance to me during my tenure as President is the long-term sustainability of the organization. The bottom line, DCLTA needs to generate revenue for it to survive and thrive. Developing a plan for sustainability will be the mission of my presidency.
For those that are not already actively involved with DCLTA, I encourage to become involved. Join a committee or start a committee. Recognize your value and the value of all members of the DCLTA. Let’s see what we can do together to make DCLTA the organization that represents the voice of title for decades to come.
Amy E. Klein
DCLTA President 2022-2023
ALTA TIRS STATE COMPLIANCE GUIDE
As you may know, ALTA maintains a state-by-state regulatory information product called TIRS State Compliance Guide. The 2022 Washington DC TIRS State Compliance Guide is now updated! It is a great resource to stay up to date with Washington DC’s legislative changes and customs and practices.
Developed by industry regulatory counsel, each state guide has been reviewed by in-state editors to ensure that the guides reflect the proper legal and operational environment in all jurisdictions.
"ALTA thanks Brian W. Thompson, Esq., Director of Jackson & Campbell, PC, and Board Member of the District of Columbia Land Title Association for his invaluable industry expertise and his time and effort in updating this guide."
The District of Columbia’s TIRS guide is available for download for FREE at https://www.alta.org/tirs-state-compliance-guide/
DCLTA members get a $100 discount for the purchase of any other individual TIRS state guide with code “TIRS100”. This offer is not valid with any other offer.
Contact Carolina Perez at cperez@alta.org for additional information or if you need assistance in purchasing the TIRS State Compliance Guides”
The division of the DC Office of Tax and Revenue that processes Homestead/Senior/Disabled applications (FP-100) has announced that, as of July 17, 2019, it will suspend the processing of applications, grant benefits, and tax account adjustments. This action was “taken to meet a demanding billing timeline to reconcile tax accounts” associated with the upcoming 2019 2nd half tax year billing.
It is anticipated that the office will resume normal processing on August 16, 2019, but that it may take up to 45 days for accounts to be “updated and a corrected tax bill mailed”. Obviously, tax bills that go out without current homestead reductions may be paid (by lenders and others) in the interim, which may require refunds of overpayments.
Inquiries should be directed to homestead@dc.gov.
Washington, D.C., April 4, 2017 — The American Land Title Association (ALTA), the national trade association of the land title insurance industry, in a letter urged the Consumer Financial Protection Bureau (CFPB) to issue an alert warning consumers about wire fraud schemes attempting to steal funds for real estate closings.
“Despite efforts by the title industry and others to educate consumers about the risk, homebuyers continue to be targeted,” said Michelle Korsmo, ALTA’s chief executive officer. “With the spring homebuying season underway, it’s vital to continue raising awareness about these schemes. The CFPB should take this opportunity to protect consumers from criminals looking to steal their money.”
The alert should provide tips to on how to consumers can protect themselves and questions to ask to help determine if real estate professionals have procedures in place to protect their money. ALTA has educated its members over the past few years about these wire fraud schemes, but the best defense is to inform consumers about the danger.
“Unfortunately, these criminals frequently target homebuyers prior to the title company getting involved in the transaction,” Korsmo said. “In many instances, they obtain access to unsecure email accounts used by consumers or real estate professionals. They use this access to find transaction patterns and details to make their fraudulent communications seem legitimate. The criminals will instruct the buyers to send the funds to a different account and the money vanishes in minutes.”
Ida Williams has informed us that ROD will be closed on Thanksgiving and Friday, 11/25. Regular hours will be observed on Wednesday 11/23.
Today the Consumer Financial Protection Bureau (CFPB) announced a Notice of Proposed Rulemaking (NPRM) for the TILA-RESPA Integrated Disclosure (TRID) rule. THIS IS BIG NEWS. We have until October 18 to tell our story and explain to the CFPB how TRID is impacting consumers. The Title Action Network (TAN) has developed FOUR EASY STEPS to ensure you understand the proposed changes and can help us tell the CFPB to fix the problems with TRID over the next 60 days:
I am sure you all are aware of the new requirement from DC Water that the Seller(or account holder) sign an authorization form to receive any information on the account including balances. I sent our general information request form for the Seller,in which we added authorization for DC Water to the existing language giving authority for payoffs, etc.
Below is their authorization for our language:
"A customer’s signature on this form satisfies DC Water’s authorization requirements in the following statement:
I authorize _____________________(title agency) to request loan information, including tax and payoff information, from my current lender(s) on my behalf; to order my prior Owner’s Title Insurance policy on the above property; and to request, on my behalf, any information necessary to clear potential title issues on the above property, including but not limited to contacting condominium management companies, neighborhood associations, water and utility companies, and/or other corporate or governmental entities."
Please amend your forms and you will be in compliance with DC Water’s requirements.
Regards,
1201 Dublin Road, Ste 136, Columbus, OH 43215 Phone: 202-318-0207 ©2022 DC Land Title Association
exec@dclta.com
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