Legal Entity Ownership Program (LEOP) – Filing Requirements & Penalty Provisions

Filing Requirements:

There are two circumstances that require the filing of a form BOE-100-B, Statement of Change in Control and Ownership of Legal Entities, (statement):

  1. Whenever there is a change in control or change in ownership of a legal entity and the legal entity owned an interest in California real property as of that date, the person or legal entity acquiring ownership control or the legal entity that has undergone a change in ownership must file a statement with the Board. (See Revenue and Taxation Code sections 480.1 and 480.2.)
  2. When an entity is requested by the Board to file regardless of whether or not a change in control or ownership of the legal entity has occurred or whether the legal entity owned an interest in real property.

Failure to file in either circumstance noted above will result in application of penalty pursuant to section 482(b).  The filing of a Change in Ownership Statement or a Statement of Change in Control and Ownership of Legal Entities with the county assessor does not satisfy the filing requirement.  Additional information regarding the filing period and penalty are described below.

Filing Period:

A change in control or change in ownership of a legal entity must be reported to the Board of Equalization on form BOE-100-B, Statement of Change in Control and Ownership of Legal Entities, within 90 days of the change in control or change in ownership. A legal entity must also file within 90 days of the Board's written request to file. (PLEASE NOTE: Prior to January 1, 2012, the filing deadline was 45 days.)  (See Revenue and Taxation Code section 480.1 and 480.2.)

The law does not provide for any extensions.

Exclusion from Reassessment is Applicable to the Change in Control or Ownership:

A legal entity must file form BOE-100-B, Statement of Change in Control and Ownership of Legal Entities, within 90 days of the change in control or change in ownership even if an exclusion from reassessment is applicable in order to avoid the imposition of the penalty under section 482, subdivision (b). (See Exclusions From Reassessment)

Transfers Upon Death of an Interest Holder:

In general, the date of death is deemed to be the date of the change in control or ownership (See Property Tax Rule 462.260).  Thus, the legal entity must file form BOE-100-B, Statement of Change in Control and Ownership of Legal Entities, within 90 days of the change in control or change in ownership.

However, in situations where there is insufficient information to determine whether an entity has undergone a change in control or change in ownership as of the date of death, (e.g., final distribution of the legal entity interests has not been determined) the filing of a form BOE-100-B must be made within 90 days of the date of death containing as much information as the parties have available to them.  Such filing will avoid the imposition of the penalty under section 482, subdivision (b) as long as the form BOE-100-B clearly indicates why the final distribution of the legal entity interests has not yet been determined. 

In addition, an amended form BOE-100-B must be filed within 90 days after the reporting entity or individual obtains information confirming the final distribution of the legal entity interests resulting in a change in control or change in ownership of the entity in order to avoid the imposition of the penalty. 

Penalty Provisions:

Under section 482(b), if a person or legal entity fails to file a form BOE-100-B as required by section 480.1 and 480.2, a 10 percent penalty is applicable. The application of penalty will vary based on the date of the transfer and/or the date of the Board's request to file.

  • If the change in control or ownership occurs on or after January 1, 2012, and the acquiring person or legal entity does not file a form BOE-100-B with the Board within 90 days of the event date, a penalty is applicable. Additionally, a penalty is applicable if a person or legal entity does not file within 90 days of the Board's written request to file, regardless of whether or not a change in ownership or control occurred.
  • If the change in control or ownership occurs on or after January 1, 2010 but before January 1, 2012, and the acquiring person or legal entity does not file a form BOE-100-B with the Board within 45 days of the event date, a penalty is applicable. Additionally, a penalty is applicable if a person or legal entity does not file within 45 days of the Board's written request to file, regardless of whether or not a change in ownership or control occurred.
  • If the change in control or ownership occurred on or before December 31, 2009, the law required the acquiring person or legal entity to file within 45 days of the event date. However, the penalty did not apply unless the person or legal entity failed to file a form BOE-100-B within 45 days of the Board's written request.

The penalty is 10 percent of the taxes applicable to the new base year value of the real property (e.g. land, improvements, and fixtures) reassessed if a change in control or change in ownership has occurred, or 10 percent of the current year's taxes on the real property as of the date the due date period expired (90 days after January 1, 2012; 45 days prior) if a change in control or change in ownership has not occurred.

Abatement of Penalty:

A person or legal entity seeking abatement of the penalty is required to file an application for abatement of penalty with the county board of supervisors within 60 days of being notified by the assessor and has filed a statement with the Board of Equalization. In counties where the board of supervisors has created one or more assessment appeals boards, written application must be made to the assessment appeals board. Section 1605.5(b) provides that a county board shall hear and decide issues with respect to penalties assessed under section 482; and section 1601 defines 'county board' as a county board of supervisors meeting as a county board of equalization or an assessment appeals board. (Note: the Board of Equalization or the local county assessors do not have the authority to cancel penalties assessed under section 482; the county assessor where the property is located will notify you when they have applied a penalty. An exception is when the assessor determines that the Board of Equalization's request to file was based on erroneous information – see section 483(c)(2) in effect January 1, 2012.)

For additional information on changes to penalty provisions due to changes to the law resulting from SB 816, see LTA 2010/028

Additionally LTA 2010/045 provides guidance on application of penalty on an entity's filing and includes penalty charts addressing factors that determine when a BOE-100-B is not filed timely, information on notice of penalty and penalty abatement.

The definitions of a change in control, change in ownership, or interest in real property are below: