FAQ

1. Q: How often is the City’s real property transfer tax applied?

A: The City’s real property transfer tax is applicable on all documents that convey real property within the City, unlike property taxes which occur annually. The real property transfer tax is an excise tax on the privilege of selling a real property interest, not a tax on the property itself, and is calculated on the consideration or value of the real property interest conveyed.

2. Q: Does the City impose a real property transfer tax other than the special tax imposed under Measure ULA?

A: Yes, the City imposes a real property transfer tax on all documents that convey real property within the City. The present tax (“Base Tax”) is computed based on the consideration or value of the real 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.

3. Q: What is Measure ULA and how does it work?

A: Measure ULA established the ULA Tax to fund affordable housing projects and provide resources to tenants at risk of homelessness. The ULA Tax is imposed on all documents that convey real property within the City of Los Angeles when the consideration or value of the real property interest conveyed exceeds a threshold of five million dollars, or is ten million dollars or greater, respectively

4. Q: What are the rate components of the Base Tax and the ULA Tax under the City’s real property transfer tax?

A. The rate components are as follows:

• The Base Tax rate of 0.45% (“Base Rate”).
• The ULA Tax rates of, 1) 4% for properties conveyed over $5,000,000, but under $10,000,000, and 2) 5.5% for properties conveyed at $10,000,000 or more (“ULA Rates”).
• The specific language for the new rates can be found here: https://clkrep.lacity.org/onlinedocs/2022/22-1100-S2_ord_187692_1-1-23.pdf
• The chart below is summary of the rates:

5. Q: When does the ULA Tax go into effect?

A: The ULA Tax is applicable to qualified conveyances of real property interests that occur on or after April 1, 2023.

6. Q: How will the City apply the April 1 effective date of the ULA Tax?

A: The City’s procedure for applying the ULA Tax is modeled on the ownership change rules under California Board of Equalization property tax rule 462.260 for all documents subject to the City’s real property transfer tax. If a change of ownership occurred before April 1 but is received by the county for recording on or after April 1, 2023, the taxpayer will need to provide evidence of the actual transaction date to show that it actually occurred before the April 1, 2023 effective date of the ULA Tax.

7. Q: Will the value thresholds under the ULA Tax be adjusted annually?

A: Consistent with the Measure ULA, the value thresholds of when to apply the ULA Tax and its corresponding rates will be adjusted annually based on the Bureau of Labor Statistics Chained Consumer Price Index. However, any changes in the value thresholds are not anticipated until the 2024 calendar year.

8. Q: How will the City’s real property transfer tax be applied to properties that are situated partially within the boundaries of the City?

A: The real property transfer tax will be applied in proportion to the value of the real property interest that was transferred within the boundaries of the City. If a valuation of the real property interest isn't available, the real property transfer tax should be applied based on the square footage of the property within the boundaries of the City, as a proportion of the total consideration or value of the real property interest conveyed. 

9. Q: How will the City handle over payments or under payments of the real property transfer tax?

A: If the City, through its compliance process, identifies a potential over payment or under payment, the City will notify the parties to the transaction of the potential overpayment or underpayment. In cases of overpayment, taxpayers will need to file a request for refund from the Office of Finance. The Claim for Refund Application can be found here: 

 https://finance.lacity.org/sites/g/files/wph1721/files/2021-04/refundclaim%20%281%29.pdf

In case of underpayment, the taxpayer will receive an invoice for the unpaid balance. 

10. Q: Are there any exemptions for the ULA Tax?

A: Yes, Measure ULA does provide exemptions for the ULA Tax. The ULA Tax will be not be applicable on documents that convey real property within the City of Los Angeles if the transferee is described under newly added 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

• A non-profit entity within Internal Revenue Code section 501(c)(3) with a history of affordable housing development and/or affordable housing property management experience
• A Community Land Trust, or Limited-Equity Housing Cooperative that has a history of affordable housing development and/or affordable housing property management experience
• A limited partnership or limited liability company wherein a recognized 501(c)(3) nonprofit corporation, community land trust, or limited-equity housing cooperative is a general partner or managing member and such 501(c)(3) nonprofit corporation, community land trust, or limited-equity housing cooperative has a history of affordable housing development and/or affordable housing property management experience, or such limited partnership or limited liability company includes a partner or member, respectively, that has a history of affordable housing development and/or affordable housing property management experience
• A community land trust or limited-equity housing cooperative partnering with an experienced non-profit organization
• A community land trust or limited-equity housing cooperative that does not demonstrate a history of affordable housing development and / or affordable housing property management experience which records an affordability covenant, consistent with section 22.618.3(d)(1)(i).b. of the Los Angeles Administrative Code, on the property at the time of the acquisition.

Other Exemptions

• A recognized 501(c)(3) entity which received its initial IRS determination letter designation letter at least 10 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 territory, or political subdivision thereof, or any other federal, state or local public agency or public entity
• Any entity or agency exempt from the City's taxation power under the California or U.S. Constitutions 

11. Q: How will the Los Angeles Housing Department determine if a transferee qualifies under section 21.9.14 of the LAMC?

A: The Los Angeles Housing Department will be promulgating regulations to further define “history of affordable housing development” and “affordable housing property management experience” and will be publishing information on the type of documents, records, or other writings that will need to be submitted by a transferee to satisfy those definitions and be deemed a qualifying transferee under section 21.9.14 of the LAMC.

12. Q: How will the Office of Finance determine if a transferee qualifies undersection 21.9.15 of the LAMC?

A: The Office of Finance will be publishing information on the type of documents, records, or other writings that will need to be submitted by a transferee to be deemed a qualifying transferee under section 21.9.15 of the LAMC.

13. Q: How will the City administer the ULA Tax exemption to those applicable documents that convey real property within the City of Los Angeles?

A: All ULA Tax exemptions will be processed through the City’s refundprocess following the payment of the ULA Tax and the Base Tax. As noted above, transferees will need to provide the necessary documents, records, or writings to demonstrate that they are qualifying transferees under sections 21.9.14 or 21.9.15 of the LAMC. Once submitted, the Los Angeles Housing Department or the Office of Finance, respectively, will make a determination and issue a certification of eligibility with respect to the relevant documents that conveyed real property. Once that certification is received, a refund request may be submitted to the Office of Finance for the ULA Tax that was paid. The refund request form can be found at:

The certification of eligibility issued by the Los Angeles Housing Department or the Office of Finance will be limited and only applicable to the particular transaction for which a ULA Tax exemption is being requested.