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1. Faq
2. Real Residential Or Commercial Property Transfer Tax And Measure ULA FAQ
   
   Real Residential Or Commercial Property Transfer Tax and Measure ULA FAQ
   
   Prices Calculate tax
   
   Tax Due
   
   Effective for transactions closing after June 30, 2025, the brand-new thresholds for ULA will be $5,300,000 and $10,600,000. Transactions above $5,300,000 however under $10,600,000 will be evaluated a 4% tax and deals $10,600,000 and up will be evaluated a 5.5% tax.
   
   - Link to United to House LA (ULA) Dashboard (Los Angeles Housing Department).
   - Link to Source Data
   
   
   How typically is the City's genuine residential or commercial property transfer tax used?
   
   The City's real residential or commercial property transfer tax applies on all files that convey real residential or commercial property within the City, unlike residential or commercial property taxes which occur yearly. The genuine residential or commercial property transfer tax is an excise tax on the privilege of offering a real residential or commercial property interest, not a tax on the residential or commercial property itself, and is determined on the factor to consider or worth of the real residential or commercial property interest conveyed.
   
   Does the City impose a real residential or commercial property transfer tax aside from the unique tax enforced under Measure ULA?
   
   Yes, the City imposes a genuine residential or commercial property transfer tax on all files that communicate genuine residential or commercial property within the City. The present tax (" Base Tax") is computed based upon the factor to consider or value of the real residential or commercial property interest conveyed at a rate of 0.45%. The special tax under Measure ULA (" ULA Tax") imposes an additional tax on top of the Base Tax.
   
   What is Measure ULA and how does it work?
   
   Measure ULA established the ULA Tax to money inexpensive housing jobs and supply resources to renters at risk of homelessness. The ULA Tax is enforced on all files that communicate genuine residential or commercial property within the City of Los Angeles when the consideration or worth of the genuine residential or commercial property interest conveyed exceeds a threshold of five million dollars, or is ten million dollars or greater, respectively.
   
   What are the rate components of the Base Tax and the ULA Tax under the City's genuine residential or commercial property transfer tax?
   
   The rate elements are as follows:
   
   - The Base Tax rate of $2.25 per $500 or part thereof (" Base Rate").
   - The ULA Tax rates of, 1) 4% for residential or commercial properties communicated over $5,150,000, however under $10,300,000 and 2) 5.5% for residential or commercial properties conveyed at $10,300,000 or more (" ULA Rates").
   - The specific language for the brand-new rates can be discovered here: https://clkrep.lacity.org/onlinedocs/2022/22-1100-S2_ord_187692_1-1-23.pdf.
   - The chart below is summary of the rates:.
   
3. Note: the City's Base Rate is $2.25 for every single $500 or fractional part thereof. A transfer in which the value of the residential or commercial property conveyed is not divisible by $500 will be rounded up to the nearby $500 for the computation of the Base Tax. This does not use to the ULA Rate estimations, which are percentage-based.
   
   When did the ULA Tax go into result?
   
   The ULA Tax is appropriate to certified conveyances of real residential or commercial property interests that occur on or after April 1, 2023.
   
   How will the City apply the April 1 reliable date of the ULA Tax?
   
   The City's treatment for applying the ULA Tax is designed on the ownership modification guidelines under California Board of Equalization residential or commercial property tax rule 462.260 for all files based on the City's real residential or commercial property transfer tax. If a change of ownership occurred before April 1 however is received by the county for taping on or after April 1, 2023, the taxpayer will need to provide proof of the actual deal date to show that it actually took place before the April 1, 2023 effective date of the ULA Tax.
   
   Will the value limits under the ULA Tax be changed each year?
   
   Consistent with the Measure ULA, the value thresholds of when to use the ULA Tax and its matching rates are changed each year based on the Bureau of Labor Statistics Chained Consumer Price Index.
   
   How will the City's real residential or commercial property transfer tax be used to residential or commercial properties that are located partially within the borders of the City?
   
   The genuine residential or commercial property transfer tax will be used in percentage to the worth of the genuine residential or commercial property interest that was transferred within the boundaries of the City. If an assessment of the real residential or commercial property interest isn't readily available, the real residential or commercial property transfer tax should be applied based upon the square video of the residential or commercial property within the borders of the City, as a percentage of the total factor to consider or value of the genuine residential or commercial property interest conveyed.
   
   How will the City handle over payments or under payments of the genuine residential or commercial property transfer tax?
   
   If the City, through its compliance process, identifies a potential over payment or under payment, the City will alert the celebrations to the deal of the possible overpayment or underpayment. In cases of overpayment, taxpayers will require to file an ask for refund from the Office of Finance. The Claim for Refund Application can be found here:
   
   https://finance.lacity.gov/sites/g/files/wph1721/files/2021-04/refundclaim%20%281%29.pdf
   
   In case of underpayment, the taxpayer will receive a billing for the overdue balance.
   
   Are there any exemptions for the ULA Tax?
   
   Yes, Measure ULA does provide exemptions for the ULA Tax. The ULA Tax will be not be relevant on documents that communicate real residential or commercial property within the City of Los Angeles if the transferee is explained under newly included sections 21.9.14 and 21.9.15 of the Los Angeles Municipal Code (" LAMC"). The transferee descriptions are as follows:
   
   Qualified Affordable Housing Organizations under LAMC Section 21.9.14
   
   - A non-profit entity within Internal Revenue Code area 501( c)( 3) with a history of budget friendly housing advancement and/or budget friendly housing residential or commercial property management experience.
   - A Neighborhood Land Trust, or Limited-Equity Housing Cooperative that has a history of inexpensive housing advancement and/or inexpensive housing residential or commercial property management experience.
   - A restricted partnership or restricted liability business where a recognized 501( c)( 3) not-for-profit corporation, community land trust, or limited-equity housing cooperative is a general partner or handling member and such 501( c)( 3) nonprofit corporation, community land trust, or limited-equity housing cooperative has a history of budget friendly housing development and/or budget friendly housing residential or commercial property management experience, or such restricted partnership or restricted liability business consists of a partner or member, respectively, that has a history of economical housing development and/or budget-friendly housing residential or commercial property management experience.
   - A neighborhood land trust or limited-equity housing cooperative partnering with a skilled non-profit organization.
   - A neighborhood land trust or limited-equity housing cooperative that does not demonstrate a history of budget-friendly housing advancement and/ or budget-friendly housing residential or commercial property management experience which tape-records a price covenant, constant with section 22.618.3( d)( 1 )( i). b. of the Los Angeles Administrative Code, on the residential or commercial property at the time of the acquisition.
   The Los Angeles Housing Department administers demands for ULA tax exemptions under LAMC Section 21.9.14.
   
   Other Exemptions under LAMC Section 21.9.15
   
   - A recognized 501( c)( 3) entity which got its preliminary IRS determination letter classification letter a minimum of ten years prior to the transaction and has assets of less than $1 billion.
   - The United States or any agency or instrumentality thereof, any state or area, or political neighborhood thereof, or any other federal, state or regional public agency or public entity.
   - Any entity or company exempt from the City's taxation power under the California or U.S. Constitutions.
   - All other transactions which are exempt from the base Real Residential or commercial property Transfer Tax per regional, state, or federal laws and regulations.
   The Office of Finance administers requests for ULA tax exemptions under LAMC Section 21.9.15. To request a determination of an entity's exemption from the ULA under 21.9.15( a), please send the following documents and information to finance.ula@lacity.org.
   
   - Power of Attorney.
   - Legal name.
   - Mailing address.
   - IRS 501 (c)( 3) determination letter showing the effective date of the exemption status.
   - Latest Form 990 or most current audited financial statements.
   Once the proper documents has actually been provided and a decision of exemption has actually been made, the Office of Finance will supply a letter licensing that transactions where the entity is the buyer/transferee are exempt from the tax. The letter is good for one year from the date of the letter.
   
   If a transaction has already happened and the tax was paid, but the purchaser consequently believes it gets approved for an exemption, they will need to submit a refund claim using the type noted above.
   
   Is the exact same measure used to figure out the Base Tax and the ULA Tax?
   
   For the Base Tax, it is calculated based on net value of the residential or commercial property communicated (special of the value of any lien or encumbrance remaining thereon at the time of sale.) For the ULA Tax, it is calculated based on gross worth (consisting of the worth of any lien or encumbrance staying thereon at the time of sale.)
   
   If the buyer is assuming the seller's loan, is the assumed loan amount excluded from the worth of the residential or commercial property communicated?
   
   For the Base Tax, it is determined based on net worth (exclusive of the assumed loan quantity.) For the ULA Tax, it is computed based on gross worth (including the presumed loan quantity.)
   
   If you have any questions relating to the ULA Tax, please contact finance.ula@lacity.org or (213) 635-7277.
   
   Office of Finance
   
   Office of Finance Special Desk Unit 200 North Spring Street, Room 101 Los Angeles, CA 90012
   
   Customer Service Center (844) 663-4411 Phone Hours: Monday, Tuesday, Wednesday and Thursday: 9:00 a.m. - 3:00 p.m. Friday: 9:00 a.m. - 2:00 p.m.
   
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