D. Exceptions

• Library: Practical Guide to Commercial Real Estate in South Carolina (SCBar) (2012 Ed.)

D. Exceptions

1. Deed of Distribution/Gifts

A deed of distribution from an estate or trust is not subject to the deed recording fee.⁷ A deed transferring realty as a gift is not subject to the deed recording fee.⁸

2. Transfers of Realty Less Than $100.00

Transfers of realty with a value equal to or less than $100 is exempt from the deed recording fee.⁹

3. Transfers to the Federal or State Government

Transfers to the federal or state government, their agencies and departments and their political subdivisions including school districts are exempt from deed recording fees.¹⁰

4. Exempt Transactions

Deeds otherwise exempt under the laws of the state of South Carolina or the United States.¹¹

5. Transfers Between Spouses

Transfers of realty between spouses or incident to divorce in which no gain or loss is recognized by reason of Section 1041 of the Internal Revenue Code of 1986, as amended, is exempt from deed recording fees.¹²

6. Partition Actions

No deed recording fee is imposed on deeds recorded in order to partition realty as long as no consideration is paid for the transfer other than the interests in the realty that are exchanged to effect the transfer.¹³

7. Grave Spaces

Transfers of individual grave spaces at a cemetery owned by a cemetery company licensed under Chapter 55 of Title 39 are exempt from the deed recording fee. Presumably grave spaces at a cemetery not owned by a licensed cemetery company would not be exempt.¹⁴

8. Timber

Timber deeds are not subject to the deed recording fee.¹⁵

9. Contributions to a Corporation, Partnership or Trust

Contributions of realty to a corporation, partnership or trust (in which the transferor is a beneficiary) in exchange for an equity interest in such entity are not subject to the deed recording fee so long as the transfer is without consideration (other than the receipt of the equity interest or as a capital contribution).¹⁶
A transfer to a limited liability company is deemed to be a transfer to a partnership.¹⁷
Transfers from a corporation, partnership or trust (with the exception of the transfer from one family trust to another family trust) to a stockholder, partner or trust beneficiary are, other than as discussed below, subject to deed transfer fees.¹⁸

10. Family Partnerships, Family Trusts and Charitable Entities

Transfers of realty from a family partnership to a partner, from a family trust to a beneficiary, or from a family partnership or trust to a charitable entity, as defined in S.C. Code § 12-6-40(A), are exempt from the deed recording fee.¹⁹ The term "Family" is defined to include spouse, parents, grandparents, sisters, brothers, children, stepchildren, grandchildren, and the spouses and lineal descendants of any of them. Family also include "the grantor's and the grantor's spouse's heirs under a statute of descent and distribution."

11. Corporate Mergers or Consolidations

A transfer of realty in a statutory merger or consolidation from a constituent corporation to the continuing or new corporation is exempt from the deed recording fee.²⁰ Under the Corporate Code, upon the effective date of the merger "title to all real estate and other property owned by each Corporation party to the merger is vested in the surviving entity without reversion or impairment."²¹ Thus, there is no need to transfer realty in a merger other than perhaps for notice purposes. Interestingly, the Deed Recording Fee statutes do not address conversions. Under our conversion statutes, a notice filing must be made in the office of the register of deeds of the county in South Carolina in which the real property is located. The notice can be by (i)

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