Sales verification is an integral component of the Reappraisal process. State law requires the Assessor to verify each sale as it occurs to ensure that it is an arm’s-length transaction. A team of appraisers makes sure the sales contained in the qualified sales file reflect a transaction between two unrelated parties, both seeking to maximize their position.
Transfer Declarations are used to gather vital sales data such as grantor and grantee, dates, prices, locations, and property characteristics at the time of sale. The information provided is critical in determining legitimacy of sales and any adjustments to sales prices before they are used in the valuation process. The data is analyzed to determine viability, reasonableness and accuracy of the transaction. The qualified sales file contains actual sales that occur during the statutory study period, defined by Colorado State Statute as “the eighteen-month period ending on the June 30th of the year prior to a re-appraisal year”. These qualified sales reflect the current market conditions within their respective neighborhoods and are used to create values and value models which are then checked for accuracy before being applied to the valuation process. The data is also used to provide property data quality control and to gauge market trends.
According to Colorado State Statute (C.R.S. §39-14-102), any conveyance document presented for recordation must be accompanied by a Real Property Transfer Declaration that has been completed and signed by either the grantor or the grantee. The Real Property Transfer Declaration, also called a TD-1000, provides essential information to the Assessor to help ensure fair and uniform assessments for all property tax purposes. All conveyance documents subject to the documentary fee submitted to the Clerk and Recorder for recordation must be accompanied by a Real Property Transfer Declaration, completed and signed by the Seller (grantor) or Buyer (grantee).
The transfer declaration establishes sale amount, defines property type and condition, verifies arm’s length transactions, identifies personal property (generally not taxable), identifies trades, exchanges and other unique characteristics and special financing considerations that may have affected the sales price. You may download a Transfer Declaration form, or view the Transfer Declaration Completion Guide for more details on the information requested as part of the sales verification process.
When a transfer declaration is submitted with a conveyance document to the Clerk and Recorder, the conveyance document is recorded and becomes part of the property public record. Transfer declarations however, are confidential documents and may be made available for inspection only to the grantee specified in the conveyance document, the grantor if they completed the declaration, the Assessor and assessor staff and the Colorado Property Tax Administrator or their employees.
Process and Penalties if not filed
If the declaration does not accompany the conveyance document at the time it is presented for recordation, the County Clerk records the conveyance document and notifies the County Assessor that the declaration did not accompany the conveyance document. Upon receiving notice that the declaration was not received, the Assessor sends written notice to the grantee (specified in the conveyance document) that the grantee must provide the declaration within 30 days of the date the notice was mailed.
If the grantee fails to provide the declaration within 30 days of the date the notice was mailed, the Assessor may impose on the grantee a penalty of twenty-five dollars or a penalty equal to twenty-five one-thousandths of one percent of the sale price pursuant to the conveyance document, whichever is greater. In each subsequent year in which the grantee fails to file the declaration, the Assessor may impose the specified penalties. Any unpaid penalties are certified to the county treasurer by January 1 of each year and are included in the statement sent to the grantee (pursuant to section §39-10-103) for property taxes levied against the real property.