Connecticut State Department of Revenue Services

Upcoming CT DRS webinar: Select to register for the upcoming Withholding Forms W-2 and 1099 Annual Filing Webinar on Wednesday, December 4, 2024, at 10:00 a.m.

This information is not current and is being provided for reference purposes only

LSN 90-4 

Special Notice Concerning Controlling Interest Transfer Taxes

This LSN has been superseded by SN 2003(11)
Legislation passed by the 1990 Connecticut General Assembly significantly amends the controlling interest transfer taxes. These taxes, first enacted by the 1989 Connecticut General Assembly, are imposed on the transfer of a controlling interest in an entity (such as a corporation, partnership, association, trust, etc.) that owns Connecticut real property valued at $2,000 or more. See 1989 Conn. Pub. Acts 251, §§38 to 53, inclusive.

While a controlling interest was formerly defined as being 50% or more of the total combined voting power of all classes of stock of a corporation (or 50% or more of the capital, profits or beneficial interest in a partnership, association, trust, etc.), 1990 Conn. Pub. Acts 315, § 2 redefines a controlling interest as being more than 50% of the total combined voting power of all classes of stock of a corporation (or more than 50% of the capital, profits or beneficial interest in a partnership, association, trust, etc.). This change applies to any sale or transfer of a controlling interest in an entity occurring on or after July 1, 1989.

While only the transferor of a controlling interest was formerly required to file a tax return (Form AU 330) on or before the last day of the month following the month in which the transfer of a controlling interest occurred, 1990 Conn. Pub. Acts 315, §1 requires the entity in which a controlling interest is transferred to file an informational return (Form AU 331), and to maintain records, pertaining to any such transfer. The Department requires that such informational returns be filed on or before the last day of the month following the month in which the transfer occurred. This change applies to any sale or transfer of a controlling interest in an entity occurring on or after July 1, 1990.

LSN 90-4 (NEW 7/90)