Court Holds Diocese Reorganization Not Subject To Property Transfer Tax

According to a January 9 press release from the Catholic Archdiocese of San Francisco, a California Superior Court judge has finalized a tentative opinion issued in November holding that the archdiocese is not liable for some $20 million in transfer taxes that had been assessed against it in connection with a reorganization  that transferred some 232 archdiocese properties to two new Catholic non-profit holding companies. Apparently the reorganization is designed to protect the properties from any future clergy abuse judgments. (See prior posting.)  According to California Catholic Daily, the court found that the transaction was merely a change in corporate form, not a transfer.