New legislation has recently been enacted which exempts sales of certain residential dwellings and seasonal rentals from Bulk Sales notification requirements. According to A-2748, which was signed into law on September 14, 2011, sales of a “simple dwelling house” when the seller is an “individual”, “estate” or “trust” (as those terms are used for purposes of the New Jersey Gross Income Tax Act N.J.S.54A:1-1 et seq.) are exempt from the Bulk Sales notification requirements (N.J.S 54:50-38). A “simple dwelling house” under the new law is a dwelling unit including but not limited to a one-family or two-family building or structure, or a unit in a condominium or a cooperative.
This exemption does not include structures containing more than two units of dwelling space or commercial property even if it includes units of dwelling space.
The new law also exempts seasonal rental units from the Bulk Sales notification requirements when the seller is an “individual”, “estate” or “trust” (as those terms are used for purposes of the New Jersey Gross Income Tax Act N.J.S.54A:1-1 et seq.). A “seasonal rental unit” under the new law includes “a dwelling unit rented for a term of not more than 125 consecutive days for residential purposes by a person having a permanent residence elsewhere” or a “timeshare estate.”
These new exemptions do not include sales where the seller is a business entity, including but not limited to a corporation or a partnership (which would also include limited liability companies).
The new law took effect September 14,2011 and applies retroactively to sales and transfers on or after August 1, 2007. If you have questions regarding this new law and would like to discuss how it could potentially impact you, please feel free to contact me in my firm’s Lawrenceville, New Jersey office to discuss this matter in more detail.