HomeMy WebLinkAboutAgenda - 04-15-2025; 8-b - Refund Request for Overpayment of Excise Tax from Kennon Craver, PLLC, Attorneys at Law 1
ORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: April 15, 2025
Action Agenda
Item No. 8-b
SUBJECT: Refund Request for Overpayment of Excise Tax from Kennon Craver, PLLC,
Attorneys at Law
DEPARTMENT: Register of Deeds
ATTACHMENT(S) INFORMATION CONTACT:
January 16, 2025 Refund Request Letter Amy McLamb, 919-245-2677
from Kennon Craver, PLLC, Attorneys Mark Chilton, 919-245-2679
at Law with First Page of September
26, 2023 Recorded Deed of
Conservation Easement and Receipt
First Page of October 28, 2024 Re-
Recorded Deed of Conservation
Easement with a Corrective Statement
to Reflect the Conservation Easement
as a Gift
Related North Carolina General Statutes
PURPOSE: To approve a refund request for overpayment of excise tax in the amount of $444 to
Kennon Craver, PLLC, Attorneys at Law.
BACKGROUND: North Carolina General Statute 105-228.37 sets forth the process for requesting
a refund of overpayment of excise tax. The statute states a taxpayer who pays more than is due
may request a refund by submitting a written request to the Board of County Commissioners of
the county where the tax was paid, and must explain why the taxpayer believes a refund is due.
On September 26, 2023, the Kennon Craver law firm submitted a Conservation Easesment for
Electronic Recording document, stating the amount of excise tax due as $444, which was
collected at the time of recording in Book 6828 Page 669.
On October 28, 2024, Kennon Craver re-recorded a corrective Conservation Easement document
in Book 6860 Page 1832, stating the Conservation Easement was a gift and to correct the excise
tax, noting that no excise tax was due/applicable.
On January 16, 2025, Kennon Craver submitted a letter to the Orange County Register of Deeds
office requesting a refund for the overpayment of the excise tax in the amount of$444. The refund
request letter, the first page of the original September 26, 2023 recorded document, and the
September 26, 2023 transaction receipt are attached.
The first page from the October 28, 2024 re-recorded document with the corrective statement to
reflect the transaction as a gift with no excise tax is also attached for reference.
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FINANCIAL IMPACT: Kennon Craver, PLLC, Attorneys at Law is requesting a $444 refund for
overpayment of excise tax.
ALIGNMENT WITH STRATEGIC PLAN: This item supports:
• MISSION STATEMENT — Orange County is a visionary leader in providing governmental
services valued by our community, beyond those required by law, in an equitable,
sustainable, innovative and efficient way.
RECOMMENDATION(S): The Manager recommends that the Board approve the refund request
for overpayment of excise tax in the amount of $444 to Kennon Craver, PLLC, Attorneys at Law.
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KENNON
pllc
ATTORNEYS AT LAW
January 16, 2025
VIA EMAIL
Orange County Register of Deeds
Attn: Orange County Board of County Commissioners
Assistant Register of Deeds
P.O. Box 8181
228 South Churton Street Suite 300
Hillsborough, NC 27278
amclamb@oranp,ecountync.Bov
Re: Refund of Excise Tax
Deed of Conservation Easement recorded in Book 6828, Page 669
Grantor: Herman Ford Staats and Janet Sue Staats, Co-Trustees
Grantee:Triangle Land Conservancy
Property Address: 6700&6702 Doc Corbett Road
Orange County PIN: 9838-49-5313
Dear Orange County Board of County Commissioners,
Our office submitted the attached Deed of Conservation Easement, recorded in Book 6828, Page
669 on September 26, 2023.The excise tax amount listed on the Deed of Conservation Easement and
paid to the Orange County Register of Deeds was incorrect at the time of recording.The Conservation
Easement was an absolute gift and should have listed$0.00 for the excise tax instead of$444,00. To
correct this error,our office recorded a Revised Deed of Conservation Easement in Book 6860, Page
1832 on October 28, 2024.
Please consider this letter our request to refund the fee of the excise tax only, in the amount of
$444.00 via check payable to Kennon Craver, PLLC.This check can be mailed to our office at P.O. Box
51579, Durham NC 27717. If you need any additional information regarding this request, please feel free
to call our office and ask for me or my administrative assistant, Keisha Stocks-James.
Sincerely,
Laina Womble Saleh
4011 university drive,suite 300,durham,tic 27707 post office box 51579,durhatn, tic 27717-1579
TELEPHONE 919 490 0500 FAX 919490057.3 • ivivw.kennoncraver.com
BK 6828 PG 669 -699 (31) DOC# 30093867
This Document eRecorded: 09/26/2023 11:55:55 AM 4
Fee: $90.00 Tax: $444.00
Orange County, North Carolina
MARK CHILTON, Register of Deeds by JASMIN SHANKLE
Prepared by Kennon Craver,PLLC(LAW)
Return to Grantee,P.O. Box 11848,Durham,NC 27702
Excise Tax:S 4q Lj.W
NCLWF No.2022D-009=TLC Back Creek Farm
NORTH CAROLINA Parcel ID: 410819
ORANGE COUNTY PIN: 9838-49-5313
DEED OF CONSERVATION EASEMENT
I 'n This Duped of Conservation Easement(hereinafter"Conservation Easement")is made this
Z W D day of Ir. 2023,by Herman Ford Staats and Janet Sue Staats,Co-Trustees
of the Staats Living Trust dated March 29,2022, and any amendments thereto, whose address is
6702 Doc Corbett Road, Cedar Grove,NC 27231 ("Grantor') and Triangle Land Conservancy,a
North Carolina nonprofit corporation, whose address is P.O. Box 1848, Durham, NC 27702
("Grantee").
i
The designation Grantor and Grantee as used herein shall include said parties, their heirs,
successors and assigns,and shall include singular,plural,masculine,feminine or neutral pronouns
as required by context.
I RECITALS
A. Grantor is the sole owner in fee simple of that property (the "Property") legally
described in Exhibit A, attached hereto and incorporated by this reference, which consists of
52.477 acres, more or less, located in Orange Co ty,North Carolina, and that is shown on the
plat recorded in Plat Book Page Orange County Registry(the"Plat'). The
Plat is incorporated herein by reference.
B. Grantee is a nonprofit organization, operated primarily for conservation purposes,
including protection of environmentally valuable and sensitive land for charitable, scientific,
educational,and aesthetic purposes.Grantee is a tax exempt public charity under Section 501(c)(3)
and 509(a)(2) of the Internal Revenue Code, is authorized by the laws of the State of North
submitted electronically by "Kennon Craver, PLLC"
in compliance with North Carolina statutes governing recordable documents
and the terms of the submitter agreement with the orange county Register of Deeds.
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MARK CHILTON
Orange County Register of Deeds
228 South Churton Street, Suite 300
P O Box 8181
Hillsborough, NC 27278
(919) 245-2675
Receipt For Services
Cashier: JASMIN SHANKLE Receipt Started: 09/26/2023 11:36:43 AM
Receipt#: 20230926113643-32 Reprinted: 03/03/2025 02:20:29 PM
SIMPLIFILE, LC
Kennon Craver, PLLC
CERTIFICATE (CERT)
Party 1: STAATS, HERMAN FORD
Party 2: THE STAATS LIVING TRUST
Book / Page: 6828 / 667 - 2 Page(s)
Time: 09/26/2023 11:55:54 AM
Recording Fee: $26.00
Excise Tax: $0.00
SUBTOTAL: $26.00
EASEMENT (EASE)
Party 1: STAATS, HERMAN FORD
Party 2: TRIANGLE LAND CONSERVANCY
Book / Page: 6828 / 669 - 31 Page(s)
Time: 09/26/2023 11:55:55 AM
Recording Fee: $90.00
Excise Tax: $444.00
SUBTOTAL: $534.00
Receipt Total: $560.00
Change Due: $0.00
BK 6860 PG 1832 - 1862 (31) DOC#30109308
This Document eRecorded: 10/28/2024 12:53:16 PM 6
Tax: $0,00
to Orange Orange County, North Carolina
MARK CHILTON, Register of Deeds by ANNA WOOD
THIS CONSERVATION EASEMENT IS BEING RE-RECORDED TO CORRECT THE EXCISE TAX LISTED
ON THE FACE OF THE INSTRUMENT. THIS CONSERVATION EASEMENT WAS AN ABSOLUTE GIFT.
Prepared by Kennon Craver,PLLC(LAW)
Return to Grantee,P.O.Box 1848,Durham,NC 27702
Excise Tax:$0.00(gift)
NCLWF No.2022D-009—TLC Back Creek Farm
NORTH CAROLINA Parcel ID: 410819
ORANGE COUNTY PIN: 9838-49-5313
DEED OF CONSERVATION EASEMENT
This Deed of Conservation Easement(hereinafter"Conservation Easement")is made this
26th day of September, 2023,by Herman Ford Staats and Janet Sue Staats, Co-Trustees of the
Staats Living Trust dated March 29,2022,and any amendments thereto, whose address is 6702
Doc Corbett Road,Cedar Grove,NC 27231 ("Grantor")and Triangle Land Conservancy,a North
Carolina nonprofit corporation,whose address is P.O.Box 1848,Durham,NC 27702("Grantee").
The designation Grantor and Grantee as used herein shall include said parties, their heirs,
successors and assigns,and shall include singular,plural,masculine,feminine or neutral pronouns
as required by context.
RECITALS
A. Grantor is the sole owner in fee simple of that property(the"Property") legally
described in Exhibit A, attached hereto and incorporated by this reference, which consists of
52.477 acres,more or less,located in Orange County,North Carolina,and that is shown on the
plat recorded in Plat Book 126, Page 164, Orange County Registry(the "Plat"). The Plat is
incorporated herein by reference.
B. Grantee is a nonprofit organization,operated primarily for conservation purposes,
including protection of environmentally valuable and sensitive land for charitable, scientific,
educational,and aesthetic purposes.Grantee is a tax exempt public charity under Section 501(c)(3)
and 509(a)(2) of the Internal Revenue Code, is authorized by the laws of the State of North
submitted electronically by "Kennon Craver, PLLC"
in compliance with North Carolina statutes governing recordable documents
and the terms of the submitter agreement with the orange county Register of Deeds.
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134 North Carolina Guidebook for Registers of Deeds
provide that"[t]he excise tax on instruments. . . applies to timber deeds
and contracts for the sale of standing timber to the same extent as if these
deeds and contracts conveyed an interest in real property."10°
3.2.6.1.2 AMOUNT AND COLLECTION
The state excise tax rate is$1 on each$500 or fractional part thereof of the
consideration or value of the interest or property conveyed.101 An assumed
obligation secured by a deed of trust is counted as part of the consideration,
and there is no deduction for an assumed loan or other obligation secured
by the property.
If the amount paid for the property is not a multiple of$500,the amount ,
of consideration or value is rounded up to the next multiple of$500 before
computing the tax.For example,if the amount paid for the property was
$27,700,the taxpayer would round the amount up to$28,000,and the tax
would be$56. If the amount paid was$32,350,the taxpayer would round
the amount up to$32,500, and the tax would be$65.
The transferor(grantor,seller)pays the tax to the register of the county
where the land lies 162 If the land lies in more than one county,the tax must
. . Y
be paid to the county where the most valuable part of the real estate lies.101
The statute provides that"[b]efore the instrument may be recorded,the
Register of Deeds must collect the tax due and mark the instrument to
indicate that the tax has been paid and the amount of the tax paid."114 This
is accomplished with a tax stamp affixed to the registered instrument or
}� with a notation that the excise tax was paid,including its amount.
The person who presents the instrument to the register is responsible for
reporting the amount of tax due to the register.l05 The register is therefore
not responsible for making determinations about the application of the
tax or its amount,nor is it the register's role to challenge a representation
that no consideration has been paid for a transfer. This creates an odd
dynamic,because although the grantor is responsible for paying the tax41
"
to the register,the grantee or the grantee's representative usually presents ,
the instrument,reports the amount of tax due, and delivers payment of
100.G.S.105-228.30(a).
101.Id.
102.Id.
103.Id.
" 104.G.S.105-228.32.
105.Id.
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Chapter 3: Real Estate Instrument Registration I 135
s the tax amount.The grantee has an interest in ensuring that the tax is paid,
e because a lien attaches to a taxpayer's real property for unpaid state taxes.106
The person presenting the instrument is likely to have been authorized by 1
the grantor,according to agreement or as a matter of law,to report the 1
tax due,and the register is not responsible for investigating this apparent
e authority. ''II
The statute does require that the register"collect the tax due and mark 'I!
the instrument to indicate that the tax has been paid and the amount of the q ,
tax paid_11107 Thus,a register should not accept for registration an instru-
ment for which the presenter reports a tax due unless the tax is paid.If a
t
presenter claims that a tax is not due under questionable circumstances
the register deems unclear on the record,the register may make a note in ;ilrl l
the margin reserved for the register's use about the presenter's representa-
tion to clarifywhy no tax was collected and to provide information that pll'pl
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may become useful if the presenter's claim is later scrutinized.The statute P,uIIU rj
provides a mechanism for the count to brie a civil action in superior
II''fllil'll'
P y g P I �h
r court for recovery of a tax not paid within thirty days after the register l l li,
demands payment.108
111lll
For instruments that have been photocopied or scanned into the records, ;ill�ila
the amount on the tax stamp on the recorded instrument can be used iii1°I;l'i'I
,pi 11 i l
to calculate the consideration paid for the transfer based on the rate in
effect at the time of that transfer.A real estate conveyance tax has been
in effect for much of North Carolina's history since the Civil War,initially �'y 11i'l
by the federal government.The amount of the tax has remained generally I'1pip5Pp�l
the same over more than a century even as property values have greatly 1,11jll�llliill�i'Ij,,
I�iilllllll,lq; _
appreciated. Slight increases in excise tax reflect the government's war liljjjjjili",,
financing efforts.On January 1,1968,the federal tax was repealed,and the IGgI plli j
Bill I I Illlil
state imposed the tax payable to the counties.On August 1, 1991,the tax
IlPllllltldlld'1i1�
was doubled,with most of the additional amount paid to the state.Table Ipi jlljPlilpli'o.
3.1 shows the history of the tax rate. 1llll;l!Illpldi
P'nII'I'llgdJ
3.2.6.1.3 REFUNDS AND CORRECTIONS 1lihII�IIpIIQIIi.
p411ijI�jlIV1l�l,l,'
Someone who claims to have paid more excise tax than was due may file a IIIIIIiIli11J
written refund request with the county commissioners within six months
I�IIIIIIIiiUp'li' ', I
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lililllhllilpl��' I,
106.The lien,which is applied to the excise tax by G.S.105-228.35,is described li��ildll�lllll
in G.S.105-241(d)• G IPIIUilljl
It�lll II J
107.G.S.105-228.32. !illljliilll'o�li.;
108.G.S.105-228,33. plllldlill I
jlljl�jllj'llll"III
l 111 III, J.
' ,iljll�i111111� I
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151,
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135 North Carolina Guidebook for Registers of Deeds
of payment.101 The commissioners must hold a hearing within ninety days
of the request or at a later date agreed upon by the commissioners and the
taxpayer,and the taxpayer may appeal to the North Carolina Secretary of
Revenue and the superior court.110 Before a tax is refunded,the taxpayer
must record a new instrument reflecting the correct tax,and if the tax
was paid in the wrong county,the taxpayer must record in that county a
statement that no tax was due for that reason and include the grantors'and
grantees'names and the book and page numbers of the instrument being
corrected."'The register must be notified that it is a corrected instrument,
and the register must notify the finance officer and the Department of
Revenue that it has been recorded 112
f The statute is not entirely clear about refund of the state portion of the
excise tax,but it implies that when a refund is due,the county refunds both
the county and state portions.The statute provides that after paying the
refund with any applicable interest,the county must inform,the Depart-
ment of Revenue,and if the department disagrees with the refund,it"may
assess the taxpayer for the amount of the refund." "
Someone who has underpaid the tax for a conveyance by an instrument
already recorded and wishes to pay additional tax may do so on the public
record in two ways.The instrument can be re-recorded,unaltered,with the
additional tax.Another method that enables the taxpayer to explain the
t reason for an additional recording is to use an affidavit that refers to the
prior instrument and provides any appropriate explanation,with which the
additional tax can be paid and on which the register will mark the payment.
109.G.S.105-228.37(a).
110.G.S.105-228.37.In Mecklenburg County the county commissioners may del-
egate approval authority to the county manager.If the manager does not approve,the
commissioners must hear the appeal.S.L.2009-110.
111.G.S.105-228.37(e).
112.Id.
113.G.S.105-228.37(c).
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