Tax Type
Recordation Tax
Description
Realty Transfer Tax; Deed Conveying Standing Timber
Topic
Documents Subject to Tax
Date Issued
09-01-1970
I have received your letter of August 24 in which you ask whether a tax is imposed by Virginia Code § 58-54.1 upon a deed conveying standing timber. The particular deed to which you refer provides that the grantee shall have three years in which to cut and remove the timber.
Section 58-54.1 corresponds to a federal stamp tax on a deeds now repealed. In Milwaukee Land Co. v. Poe, 31 F. 2d 733 (9th Cir. 1929), a contract for the sale of standing timber was found under local law, to be a deed, instrument or writing whereby lands, tenaments or other realty was sold, so that the federal tax applied.
[Opinion]
The rule in Virginia is otherwise. In Virginia, "when growing trees are sold under a contract providing for their separation from the soil immediately, or within a reasonable and convenient time, the contract converts them into personal property.' Straley v. Fisher, 176 Va. 163, 168 (1940). The tax would not apply to such a contract.
Whether a specified time is reasonable and convenient will depend on the facts of each case. My interpretation of the Court's criterion is that the contract is to be considered a sale of personalty only if the future growth of the trees is merely incidental to the sale.
Attorney General's Opinion