Delaware Form 5403 PDF Details

In the realm of real estate transactions within Delaware, the completion and submission of Form 5403, the Real Estate Tax Return Declaration of Estimated Income Tax, is a critical step for ensuring compliance with state taxation requirements. This form, which is handled by the Delaware Division of Revenue, plays a pivotal role for non-resident individuals, pass-through entities, or corporations involved in the conveyance of property. Its primary function is to facilitate the accurate calculation and withholding of real estate tax based on the gain from the sale of property, pegged at a rate of 6.75% of the gain's value. Key sections of this form include detailed information regarding the property transferred, the identification and status of the transferor/seller—including whether they are an individual, a trust, or a corporation among others—and a comprehensive approach to determining the tax due through calculation of the net sales price, adjusted basis of the property, and the resulting total gain. Moreover, this form accommodates situations where the transferor/seller opts for the installment method of reporting gain, thereby influencing the timing and amount of tax payable. Additionally, for transactions qualifying under certain conditions, it may necessitate no immediate payment but requires careful attention to eligibility criteria. Importantly, any tax liability uncovered must be promptly addressed to avoid legal complications. This form, alongside the requirement for the transferor's/seller's signature under penalty of perjury, underscores the seriousness with which Delaware approaches the taxation of real estate transactions, ensuring both accuracy in reporting and compliance with state law.

QuestionAnswer
Form NameDelaware Form 5403
Form Length2 pages
Fillable?No
Fillable fields0
Avg. time to fill out30 sec
Other names12_5403 delaware form 5403 for 2014

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2012

 

REAL ESTATE TAX RETURN

 

DECLARATION OF ESTIMATED

Delaware Division of Revenue

INCOME TAX

820 N. French Street, P.O. Box 8735

 

Wilmington, Delaware 19899-8735

FORM 5403

DO NOT WRITE OR STAPLE IN THIS AREA

Form 5403 must be completed for all conveyances and must be presented at the time of recording.

1.Description and address of property transferred (include property tax parcel number):

Tax Parcel Number:

2.Transferor/Seller is:

Individual or Revocable Living Trust

Corporation

Trust or Estate

Business Trust

Partnership

S Corporation

Limited Liability Company

Other

Date of Transfer:

(Month/Date/Year)

3.Transferor or Seller Acquired Property By:

Purchase

Gift

Inheritance

1031 Exchage

Foreclosure/Repossession

Other:

4.Transferor/Seller’s name; SSN or EIN; and address to which correspondence is to be mailed after settlement. (Enter only one name and SSN or EIN per return. If more than one transferor/ seller, use separate forms for each; however, if Transferors/ Sellers are spouses, enter only the primary taxpayer name and SSN, and only file one return. If transferor/seller is not an individual, list only EIN of non-individual transferor/seller and file only one Form 5403 for such transferor/seller – no Form 5403 should be filed for the members, partners, stockholders, trustees or other individuals or entities having an ownership interest in any such non-individual transferor/seller.)

Enter Social Security Number

or

Employer Identification Number of the Transferor/Seller

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Name of Transferor/Seller

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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City

State

 

 

 

 

 

 

 

 

 

 

 

 

Zip Code

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5. If applicable, check appropriate box. (Check no more than one box.)

Transferor/seller is a resident (a) individual, (b) pass-through entity or (c) corporation, and not subject to withholding under 30 Del. C. §§1126, 1606 or 1909;

Sale or exchange exempt from capital gain recognition;

Gain realized excluded from income for tax year of sale or exchange;

Sale or exchange occurred on or before December 31, 2010;

Transferor/seller has insufficient information to determine if sale or exchange is subject to withholding. By checking this box, transferor/seller understands that once sufficient information is available, payment of tax may be due and the appropriate return must be timely filed.

If any box in Section 5 is checked, DO NOT complete Sections 6, 7 and 8 below. No payment is due at this time.

6.Computation of Payment and Tax to be Withheld. (See Instructions)

a. Total sales price

a.

 

b. Less selling expenses

b.

c. Net sales price (Subtract Line b from Line a)

c.

d. Adjusted basis of property

d.

e. Total gain (Subtract Line d from Line c)

e.

f. Cash Payments (not including payments in Line b above)

f.

g. Net Cash Received (Subtract (Line f from Line c)

g.

h. Delaware Tax Due (Multiply either Line “e” or “g” by 6.75%)

h.

$

$

$

$

$

$

$

$

7.

Check box if the transferor/seller is reporting gain under the installment method. No Tax is payable at this time.

Note: If completing this section you must report and remit any capital gain tax to the State of Delaware when any capital gain as a result of the sale of this property is recognized for Federal Tax Purposes.

8. Delaware Income Tax Paid. (See Instructions.) $

Under penalty of perjury, I declare that I have examined this return and to the best of my knowledge and belief, it is true, correct and complete. If prepared by a person other than the transferor/seller, the declaration is based on all information to which the preparer has any knowledge. Transferor/Seller, Please sign and print full name and title (if any):

Signature

Name

Title

INSTRUCTIONS FORM 5403

REAL ESTATE TAX RETURN REALTY TRANSFER TAX RETURN

Every non-resident individual, pass through entity or corporation who makes, executes, delivers, accepts, or presents for recording any document, except those exemptions defined or described in Sections 1126, 1606 and 1909 of Title 30, or in whose behalf any document is made, executed, delivered, accepted or presented for recording, shall be subject to pay for and in respect to the transaction or any part thereof, a Real Estate Tax at the rate of 6.75% of the value of the gain on the property sold as represented by such document, which tax shall be payable at the time of making, execution, delivery, acceptance or presenting of such document for recording. Said tax is to be paid by the Transferor(s)/Seller(s).

SPECIFIC INSTRUCTIONS

LINE 1. Enter a description and address of the property transferred/ sold, including the tax parcel number and date of transfer. If you need to describe transfer issues please do so here.

LINE 2. Check the appropriate box to indicate whether the Transferor/Seller is an Individual or Revocable Living Trust, a Corporation, Trust or Estate, Business Trust, Partnership, S Corporation, Limited Liability Company, or Other, such as a Government Agency or Non-Profit Corporation.

LINE 3. Check the appropriate box to indicate how the transferor/ seller acquired the property.

LINE 4. Enter the Transferor/Seller’s name; SSN or EIN; and address to which correspondence is to be mailed after settlement. (Enter only one name and SSN or EIN per return. If more than one transferor/ seller, use separate forms for each; however, if Transferors/Sellers are husband and wife, enter only the primary taxpayer name and SSN, and only file one return. If transferor/seller is not an individual, list only EIN of non-individual transferor/seller and file only one Form 5403 for such transferor/seller – no Form 5403 should be filed for the members, partners, stockholders, trustees or other individuals or entities having an ownership interest in any such non-individual transferor/seller.)

LINE 5. Check the appropriate box to indicate if the transferor(s)/ seller(s) are resident individuals, pass-through entities or corporations that are not subject to real estate tax capital gain withholding; the sale or exchange is exempt from capital gain recognition because of either Federal or Delaware exemption; the gain realized will be excluded from income for tax year of sale or exchange; the sale or exchange occurred on or before December 31, 2010; or the transferor(s)/seller(s) has/ have insufficient information to determine if sale or exchange is subject to withholding. By checking the last box, the transferor(s)/seller(s) understands that, once sufficient information is available, payment of tax may be due and the appropriate return must be timely filed. If any of the above boxes in Section 5 are checked, stop here, do not complete Sections 6, 7 and 8 below, and no payment is due at this time. Be sure to only check one box.

LINE 6. On line “a” enter the ‘Total Sales Price’.

On line “b” enter the ‘Selling Expenses’.

On line “c” enter the ‘Net Sales Price’ by subtracting line “b” from line “a”.

On line “d” enter the ‘Adjusted Basis’. “Adjusted basis,” includes mortgages used to buy, construct or substantially improve the real estate, liens as well as the taxpayer’s investment in the property.

On line “e” enter the ‘Total Gain’ by subtracting line “d” from line “c”. This is the transferor’s/ seller’s capital gain for both Federal and Delaware State tax purposes.

On line “f” enter the total Cash Paid at the time of transfer or sale, not including any cash payments reported on line b.

On line “g” enter the ‘Net Cash Received’ by subtracting line f from line c.

The transferor/ seller may elect either Line e or Line g to calculate the ‘Delaware Tax Due’.

On line “h” enter the ‘Delaware Tax Due’ by multiplying either line “e” or line “g” by 6.75%. This is the amount of real estate tax payment due to the Delaware Division of Revenue that you must remit with this form unless line 7 is completed. If you elected line g to make the calculation the transferor(s)/seller(s) may owe additional Delaware Income Tax. If owed this tax is due at the time the next Quarterly Estimated Tax Payment is due.

LINE 7. If the transferor(s)/seller(s) is/ are reporting gain under the installment method no payment is due at this time, but by law you must report and remit any capital gain tax to the State of Delaware when any capital gain as a result of the sale of this property is recognized for Federal Tax Purposes.

LINE 8. Enter the amount of Delaware Tax Due from Line 6(h), unless you completed Section 7. This is the amount payable to the Delaware Division of Revenue.

The Transferor/Seller must sign Form 5403, print their full name and title, if any. This form and the estimated income tax, if any, reported due and payable on this form must be remitted with the deed to the Recorder’s Office before the Recorder shall record a deed conveying title in Delaware real estate. The tax returns or reports and the amounts of tax collected pursuant to Title 30 of the Delaware Code, Sections 1126, 1606 or 1909, and the Recorder’s Office and its employees or agents, shall be subject to the secrecy provisions and penalties of Title 30 of the Delaware Code, Section 368.”

(Revised 12/22/11)

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