As used in this subchapter, except where the context clearly indicates a different meaning:

(1) “Document” means any deed, instrument or writing whereby any real estate within this State, or any interest therein, shall be quitclaimed, granted, bargained, sold, or otherwise conveyed to the grantee, but shall not include the following:

a. Any will;

b. Any lease other than those described or defined in paragraph (5) of this section below;

c. Any mortgage;

d. Any conveyance between corporations operating housing projects pursuant to Chapter 45 of Title 31 and the shareholders thereof;

e. Any conveyance between nonprofit industrial development agencies and industrial corporations purchasing from them;

f. Any conveyance to nonprofit industrial development agencies;

g. Any conveyance between husband and wife;

h. Any conveyance between persons who were previously husband and wife, but who have since been divorced; provided such conveyance is made after the granting of the final decree in divorce and the real estate or interest therein subject to such conveyance was acquired by the husband and wife, or husband or wife, prior to the granting of the final decree in divorce;

i. Any conveyance between parent and child or the spouse of such a child;

j. Any conveyance:

1. To a trustee, nominee or straw party for the grantor as beneficial owner,

2. For the beneficial ownership of a person other than the grantor where, if such person were the grantee, no tax would be imposed upon the conveyance pursuant to this chapter, or

3. From a trustee, nominee or straw party to the beneficial owner;

k. Any conveyance between a parent entity and a wholly-owned subsidiary entity; provided such conveyance is without actual consideration;

l. Correctional deeds without actual consideration;

m. Any conveyance to or from the United States or this State, or to or from any of their instrumentalities, agencies or political subdivisions and the University of Delaware and Delaware State University;

n. Any conveyance to or from an entity, where the grantor or grantee owns an equity interest in the entity in the same proportion as the grantor’s or grantee’s interest in, or ownership of, the real estate being conveyed; provided, however, that this paragraph (1)(n) shall not apply to any distribution in liquidation or other conveyance resulting from the partial or complete liquidation of an entity, unless the equity interest of the entity being liquidated has been held by the grantor or grantee for more than 3 years;

o. Any conveyance by the owner of previously occupied residential premises to a builder of new residential premises when such previously occupied residential premises are taken in trade by such builder as a part of the consideration from the purchaser of new, previously unoccupied premises;

p. Any conveyance to the lender holding a bona fide mortgage, which is genuinely in default, either by a sheriff conducting a foreclosure sale or by the mortgagor in lieu of foreclosure;

q. Any conveyance to a religious organization or other body or person holding title to real estate for a religious organization, if such real estate will not be used following such transfer by the grantee, or by any privy of the grantee, for any commercial purpose; provided, however, that only that portion of the tax which is attributable to and payable by the religious organization or other body or person holding title to real estate for a religious organization under § 5402 of this title shall be exempt;

r. Any conveyance to or from a volunteer fire company, organized under the laws of this State; provided, however, that only that portion of the tax which is attributable to and payable by the volunteer fire company under § 5402 of this title shall be exempt;

s. Any conveyance of a “manufactured home” as defined in § 7003 of Title 25, provided tax on said conveyance has been paid under § 3002 of this title;

t. Any conveyance without consideration to an organization exempt from tax under § 501(c)(3) of the federal Internal Revenue Code [26 U.S.C. § 501(c)(3)];

u. Any conveyance to a nonprofit conservation organization when the property is purchased for open space preservation purposes;

v. Any conveyance to or from an organization exempt from tax under § 501(c)(3) of the federal Internal Revenue Code when the purpose of said conveyance is to provide owner-occupied housing to low and moderate income households by rehabilitating residential properties and reselling said properties without profit;

w. Any conveyance between siblings, half siblings, or step siblings;

x. Any conveyance to or from a land bank formed under Chapter 47 of Title 31.

(2) “First-time home buyer” means any 1 of the following:

a. A natural person who has at no time held any direct legal interest in residential real estate, wherever located, and who intends to occupy the property being conveyed as his or her principal residence within 90 days following the transaction.

b. Spouses purchasing as joint tenants or tenants by the entirety, when neither spouse has ever held any direct legal interest in residential real estate, wherever located, and both of whom intend to occupy the property being conveyed as their principal residence within 90 days following the transaction.

c. Individuals purchasing as joint tenants or cotenants, when none of the individuals has ever held any direct legal interest in residential real estate, wherever located, and both of whom intend to occupy the property being conveyed as their principal residence within 90 days following the transaction.

(3) “Transaction” means the making, executing, delivering, accepting or presenting for recording of a document.

(4) “Value” means, in the case of any document granting, bargaining, selling or otherwise conveying any real estate or interest or leasehold interest therein, the amount of the actual consideration thereof, including liens or other encumbrances thereon and ground rents, or a commensurate part of the liens or other encumbrances and ground rents which encumber the interest in real estate and any other interest in real estate conveyed; provided, that in the case of a transfer for an amount less than the highest appraised full value of said property for local real property tax purposes, “value” shall mean the highest such appraised value unless the parties or one of them can demonstrate that fair market value is less than the highest appraised value, in which case “value” shall mean fair market value, or actual consideration, whichever is greater.A demonstration that the transaction was at arm’s length between unrelated parties shall be sufficient to demonstrate that the transaction was at fair market value.

(5) The term “document” defined in paragraph (1) of this section shall include the following:

a. Any writing purporting to transfer a title interest or possessory interest for a term of more than 5 years in a condominium unit or any unit properties subject to the Unit Property Act [Chapter 22 of Title 25];

b. Any writing purporting to transfer a title interest or possessory interest of any lessee or other person in possession of real estate owned by the State or other political subdivision thereof;

c. Any writing purporting to assign or transfer a leasehold interest or possessory interest in residential property under a lease for a term of more than 5 years. For this purpose, the term “residential property” means any structure or part of structure which is intended for residential use, and excluding any commercial unit subject to tax under § 2301(a)(6) of this title, relating to commercial lessors.

(6) In determining the term of a lease under paragraph (5) of this section above, it shall be presumed for the purpose of computing the lease term that any rights or options to renew or extend will be exercised.

(7) For purposes of paragraph (4) of this section, in the case of a document described in paragraph (5) of this section under which the consideration is based in whole or in part on a percentage of the income or receipts to be received in the future, actual consideration shall include the amounts actually received under such percentage of income or receipts provision; provided, however, and notwithstanding any other provisions of this chapter, that the tax imposed by this chapter shall be due and payable to the Division of Revenue within 30 days after the date such amounts become due and payable under the agreement.

(8) a. Except as provided in paragraphs (8)b. and c. of this section, where beneficial ownership in real estate in this State is transferred through a conveyance or series of conveyances of intangible interests including mergers and all other indirect exchanges, in a corporation, limited liability company, partnership, trust, pass-through entity or other entity, such conveyance shall be taxable under this chapter as if such property were conveyed through a duly recorded “document” as defined in paragraph (1) of this section, and subject to the exemptions contained therein, except those exemptions contained in paragraphs (1)j. and n. of this section.

b. No bona fide pledge of stock or limited liability membership interest, or partnership interests as loan collateral nor any transfer of publicly traded stock; publicly traded limited liability company member interest or publicly traded partnership interest shall be deemed subject to taxation under this paragraph (8)b.

c. Where the beneficial owners of real property prior to the conveyance or series of conveyances referred to in this paragraph (8)c. own 80% or more of the beneficial interest in the real estate following said conveyance or conveyances, such transfers shall not be subject to tax under this paragraph (8)c. Where the beneficial owners of real property prior to the conveyance or series of conveyances referred to in this paragraph (8)c. own less than 80% of the beneficial interest in the real estate following said conveyance or conveyances, such transfers shall not be subject to tax under this paragraph (8)c., unless, under regulations promulgated by the Secretary of Finance, such transfer or transfers are properly characterized as a sale of real property. Such characterization shall take into account the timing of the transaction, beneficial ownership prior to and subsequent to the conveyance or conveyances; the business purpose of the corporation, limited liability company, partnership, trust, pass-through entity or other entity, and such other factors as may be relevant.

(9) a. Notwithstanding paragraph (1) of this section, there shall be included in the definition of “document” for purposes of this chapter any contract or other agreement or undertaking for the construction of all or a part of any building, except for 1 or more buildings of which 85% or more of the total square footage was constructed for the purpose of manufacturing, as defined in § 2701 of this title, all or a portion of which contract, agreement, or undertaking (or any amendment to the foregoing) is entered into, or labor or materials are supplied, either prior to the date of the transfer of the land on which the building is to be constructed or within 1 year from the date of the transfer to the grantee.

b. A jurisdiction in this State may not issue a building permit for a building unless the person or persons (including corporations or other associations) requesting the permit demonstrates in whatever form may be specified by the Director of Revenue, including at the Director’s discretion, a form of affidavit, that 1 of the following applies:

1. A transfer as described in this section has not occurred within the preceding year.

2. A portion of the contract for construction for which the permit is being requested was not entered into, and materials or labor with respect to the building have not been provided, within 1 year of the date on which the property was transferred.

3. There has been paid a realty transfer tax on the document, as defined in this paragraph (9)b.3.

4. The grantee of the property, or an entity that is part of an enterprise with common ownership or common direction and control with the grantee of the property, is or will be licensed as a manufacturer under Chapter 27 of this title.

c. In addition, no jurisdiction in this State shall issue a certificate of occupancy relative to any building on which a tax is provided by this subsection unless and until the owner recertifies the actual cost of the building and pays any additional tax due as a result of such recertification.

d. A “building” for purposes of this paragraph (9)d. shall mean any structure having a roof supported by columns or walls which structure is intended for supporting or sheltering any use or occupancy but shall not include any alteration of or addition to an existing building where the cost of said alteration or addition is less than 50% of the value of the property transferred.

e. A “transfer” for purposes of this paragraph (9)e. shall include any transfer made by a “document” as described in this section, other than this paragraph (9)e., and shall not include any transaction excluded from the definition of “document” under the provisions of paragraphs (1)a.-u. of this section.

30 Del. C. 1953, § ?5401; 55 Del. Laws, c. 109, § ?1; 55 Del. Laws, c. 413, § ?1; 59 Del. Laws, c. 153, §§ ?1-4; 60 Del. Laws, c. 507, § ?3; 62 Del. Laws, c. 316, § ?1; 64 Del. Laws, c. 182, §§ ?1, 2; 65 Del. Laws, c. 118, § ?3; 65 Del. Laws, c. 426, § ?1; 67 Del. Laws, c. 40, §§ ?8, 9; 67 Del. Laws, c. 262, § ?1; 68 Del. Laws, c. 165, § ?1; 69 Del. Laws, c. 188, § ?4; 70 Del. Laws, c. 186, § ?1; 72 Del. Laws, c. 217, § ?1; 72 Del. Laws, c. 372, § ?1; 75 Del. Laws, c. 225, §§ ?1-3, 5-7; 80 Del. Laws, c. 155, § ?3; 81 Del. Laws, c. 384, § 1; 83 Del. Laws, c. 56, § 72; 83 Del. Laws, c. 107, § 9; 83 Del. Laws, c. 323, § 7;