Reduction of Deficiency Assessed for Rent-Restricted Affordable Housing Projects

Under a new local law passed on December 15, 2023, transfers of qualified rent-restricted affordable housing that occurred between January 1, 2017, but prior to July 1, 2024, may be eligible for a partial refund of taxes paid or a reduction of a deficiency assessed if the taxpayer submits a refund request by December 31, 2024. The law also waives all penalties and interest related to deficiency determinations on transfers that occurred between January 1, 2017 and the effective date of the ordinance if the transfer qualifies for a refund or reduction of deficiency under this provision. This refund/deficiency reduction does not apply to transfers under COPA.

Requirements to Qualify for Reduction:

• Transfer occurred between January 1, 2017, but prior to July 1, 2024.
• Notice of Delinquent Real Property Transfer Taxes and Deficiency Determination recorded, but taxes not yet paid.
• Certification from Mayor’s Office of Housing and Community Development (MOHCD) that the deed, instrument, or writing effected a transfer of qualified Rent-Restricted Affordable Housing per Section 1108.6(c)(2) of the SF Business and Tax Regulations Code Article 12-C.
• Claim packet submitted on or before December 31, 2024.

Instructions to Submit Claim Packet for Reductions:

1. Fill out the appropriate request form:
   
   1. “Request for Reduction in Transfer Tax Deficiency Assessed for Rent-Restricted Affordable Housing Transfers.” Use this form when transfer taxes have been assessed at the higher rate, but not yet paid.
2. Obtain from MOHCD certification confirming that the deed, instrument, or writing effected a transfer of qualified Rent-Restricted Affordable Housing. The certification must also include the Recorded Restrictions as an exhibit. For more information, contact MOHCD at sfhousinginfo@sfgov.org
3. Submit the packet on or before December 31, 2024 to: Office of the Assessor-Recorder, 1 Dr. Carlton B. Goodlett Place, Room 190, San Francisco, CA 94102-4698. ATTN: Recording and Transactions Manager

For more information on this new law and eligibility, click here.