SUMMARY

QUESTION: Is Florida’s documentary stamp tax and nonrecurring intangible tax due on specific documents provided for review, more specifically, the Agreement, Schedule A to Credit Agreement, Schedule 1 to Schedule A to Credit Agreement, Schedule A-1 to Credit Agreement, Exhibit A to Schedule A-1 to Credit Agreement, Schedule A-2 to Credit Agreement, Schedule A-3 to Credit Agreement, Funds Transfer Request Form, the Funding Request-Private Bank Form, a margin call letter, a notice of demand, and the Private Client Line Option Priced Rate Sheet.

ANSWER - Based on the Facts Below: Documentary stamp tax as imposed under paragraph 201.08(1)(a), F.S., is due on any instrument executed, signed, or delivered in Florida that contains an unconditional written obligation to pay money. The taxability of a document under this paragraph is determined solely from the face of the document and any separate document expressly incorporated into the document. Documentary stamp tax as imposed under paragraph 201.08(1)(b), F.S., is due on any mortgage or other lien filed or recorded in Florida.

Nonrecurring intangible tax as imposed under subsection 199.133(1), F.S., is due on notes and other written obligations to pay money to the degree secured by a mortgage on Florida real property.

It is determined that the Agreement, Schedule A, Schedule 1, Schedule A-1, Exhibit A, Schedule A-2, Schedule A-3, Transfer Form, Funding Request Form, Margin Call Letter, Notice of Demand, and Option Priced Rate Sheet provided for review are not subject to documentary stamp tax imposed under paragraph 201.08(1)(a), F.S., as independent documents since neither document contains an unconditional obligation to pay or repay a sum certain in money and the signature of the borrower. It is also determined that neither of the documents reviewed contains language that expressly incorporates it with any of the other documents reviewed and as such no two or more of the documents reviewed can be considered as a single document for documentary stamp tax purposes.

This determination was made based on review of only those documents that were submitted. If other documents are used during the loan process, a different determination might result.

Documentary stamp tax as imposed under paragraph 201.08(1)(b), F.S., is due on a mortgage or other lien filed or recorded in Florida. The documents reviewed and determined to not be subject to documentary stamp tax as imposed under s. 201.08(1)(a), F.S., would be subject to tax imposed under s. 201.08(1)(b), F.S., if they purport to establish a mortgage or lien and are filed or recorded in Florida.

It is determined that nothing within the documents reviewed provide specifically for a mortgage on Florida real property. However, nonrecurring intangible tax as imposed under s. 199.133(1), F.S., would be due if Florida real property is given to secure the Agreement or any other obligation to pay money.

June 27, 2007

Re: Technical Assistance Advisement No. 07M-005

Documentary Stamp Tax and Nonrecurring Intangible Tax – Line of Credit Agreement

Paragraph 201.08(1)(a) and subsection 199.133(1), F.S.

XXX (“Taxpayer”)

Dear :

This is in response to your letter dated March 20, 2007, requesting a Technical Assistance Advisement regarding application of Florida’s documentary stamp tax as imposed under s. 201.08(1)(a), F.S., upon documents executed in Florida that are part of a line of credit agreement (“Agreement”).

Facts as Presented by Petitioner

The Agreement contains an obligation to repay the principal amount of all credit advances made under the Agreement, plus accrued interest. The Agreement states the maximum amount for the line of credit but does not contain a specific amount (or “sum certain”) that must be repaid. As such, Taxpayer believes that the Agreement and all documents provided for review are not subject to documentary stamp tax and nonrecurring intangible tax.

Request for Advisement

You request a determination by the Department of Revenue as to whether documentary stamp tax as imposed under s. 201.08(1)(a), F.S., and nonrecurring intangible tax as imposed under s. 199.133(1), F.S., are due on the documents provided for review. The documents provided for review are the Agreement, Schedule A to Credit Agreement (“Schedule A”), Schedule 1 to Schedule A to Credit Agreement (“Schedule 1”), Schedule A-1 to Credit Agreement (‘Schedule A-1”), Exhibit A to Schedule A-1 to Credit Agreement (“Exhibit A”), Schedule A-2 to Credit Agreement (“Schedule A-2”), Schedule A-3 to Credit Agreement (“Schedule A-3”), Funds

Transfer Request Form (“Transfer Form”), the Funding Request-Private Bank Form (“Funding Request Form”), a margin call letter (“Margin Call Letter”), a notice of demand (“Notice of Demand”), and the Private Client Line Option Priced Rate Sheet (“Option Priced Rate Sheet”).

Law and Discussion

Paragraph 201.08(1)(a), F.S., imposes documentary stamp tax on promissory notes and other written obligations to pay money, executed, signed or delivered in Florida. A document executed, signed or delivered in Florida is taxable if it contains an unconditional obligation to pay, or repay, a sum certain in money and the signature of the obligor. The tax is based on the amount of the obligation at the rate of $.35 per $100 or fraction thereof.

Paragraph 201.08(1)(b), F.S., imposes documentary stamp tax on mortgages or liens filed or recorded in Florida. The tax is based on the total amount of all obligations secured thereby at the rate of $.35 per $100 or fraction thereof.

Subsection 201.08(6), F.S., provides that the taxability of a document shall be determined solely from the face of the document and any separate document expressly incorporated into the document. Rule 12B-4.052(6), F.A.C., provides that a document does not expressly incorporate another document by implication or by mere reference and description of the other document. Examples of terminology whereby a document is expressly incorporated into the document under examination include, but are not limited to: (document) is incorporated herein; (document) the terms of which are incorporated herein; (document) is made a part hereof; (document) is made a part of; and (document) shall become a part of.

Subsection 199.133(1), F.S., imposes nonrecurring intangible tax on notes and other written obligations to pay money to the degree secured by a mortgage on Florida real property.

Position of the Department

It is determined that the Agreement, Schedule A, Schedule 1, Schedule A-1, Exhibit A, Schedule A-2, Schedule A-3, Transfer Form, Funding Request Form, Margin Call Letter, Notice of Demand, and Option Priced Rate Sheet provided for review are not subject to documentary stamp tax imposed under paragraph 201.08(1)(a), F.S., as independent documents since none of the documents contain an unconditional obligation to pay or repay a sum certain in money and the signature of the borrower. It is also determined that none of the documents reviewed contain language that expressly incorporates it with any of the other documents reviewed, and as such no two or more of the documents reviewed can be considered as a single document for documentary stamp tax purposes.

This determination was made based on review of only those documents that were submitted. If other documents are used during the loan process, a different determination might result.

Documentary stamp tax as imposed under paragraph 201.08(1)(b), F.S., is due on a mortgage or other lien filed or recorded in Florida. The documents reviewed and determined to not be subject to documentary stamp tax as imposed under s. 201.08(1)(a), F.S., would be subject

to tax imposed under s. 201.08(1)(b), F.S., if they purport to establish a lien and are filed or recorded in Florida.

It is determined that nothing within the documents reviewed provides specifically for a mortgage on Florida real property. However, nonrecurring intangible tax as imposed under s. 199.133(1), F.S., would be due if Florida real property is given to secure the Agreement or any other obligation to pay money.

This response constitutes a Technical Assistance Advisement under s. 213.22, F.S., which is binding on the Department only under the facts and circumstances described in the request for this advice as specified in s. 213.22, F.S. Our response is predicated on those facts and the specific situation summarized above. You are advised that subsequent statutory or administrative rule changes or judicial interpretations of the statutes or rules upon which this advice is based may subject similar future transactions to a different treatment than expressed in this response.

You are further advised that this response, your request and related backup documents are public records under Chapter 119, F.S., and are subject to disclosure to the public under the conditions of s. 213.22, F.S. Confidential information must be deleted before public disclosure. In an effort to protect confidentiality, we request you provide the undersigned with an edited copy of your request for Technical Assistance Advisement, the backup material and this response, deleting names, addresses and any other details which might lead to identification of the taxpayer. Your response should be received by the Department within 15 days of the date of this letter.

Sincerely,

Charles T. Phillips

Tax Law Specialist

Technical Assistance and Dispute Resolution

CTP/mh

Record ID: 30033