HARRISBURG, PA-A new provision in the state tax code is closinga loophole that previously allowed some major real estate investorsto avoid paying transfer taxes on acquisitions.

State Sen. Jim Ferlo reports that he led abi-partisan effort to ensure investors pay the state's transfertax. While the state's 89-11 loophole was eliminated at the end oflast year, the senator states, “This year's tax code clarified somedefinitions under the law and detailed the types of contractualrelationship that trigger the collection of this tax. This effortlevels the tax playing field.”

Previously, the 89-11 loophole allowed an investor to acquire89% of the interest in the company that owns a property, then buythe remaining 11% of the company within three years. The state'sdeed-transfer tax only kicks in when 90% or more of the investmentis transferred within three years, according to the PittsburghBusiness Times.