First Berkshire Business Trust v. Commissioner, New Hampshire Department of Revenue Administration, 13 A.3d 232

Three petitioners—First Berkshire Business Trust, First Berkshire Properties, LLC, and Second Berkshire Properties, LLC—challenge DRA real estate transfer taxes, interest, and penalties tied to two transfers involving 200 John E. Devine Road in Manchester.
First Trust refinanced in April 2003 with Wells Fargo, creating First LLC as a single-purpose entity; title and borrower status were placed in First LLC with a deed recording the transfer from First Trust to First LLC for ten dollars and other consideration.
In summer 2003, a second refinancing led to the creation of Second LLC; a deed from First LLC to Second LLC was recorded, transferring the same property for ten dollars and other consideration.
DRA issued notices of assessment in October 2004 for the petitioners, asserting tax, penalties, and interest; the petitioners sought re-determination and hearings were held.
Superior Court upheld DRA’s tax assessment based on fair market value, but held penalties for nonpayment were improper; the petitioners appealed further.
The Supreme Court affirmed, holding the transfers were bargained-for exchanges and that DRA could rely on fair market value to determine actual consideration for the transfer tax.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Are the transfers subject to the real estate transfer tax?	petitioners argue transfers are not bargained-for exchanges under RSA 78-B:1-a.	DRA contends transfers are taxable as contractual transfers or under fair market value rules.	Yes, transfers are taxable as bargained-for exchanges.
Did the transfers constitute bargained-for exchanges requiring consideration of value?	First Trust and affiliates claim lack of arm's-length bargaining and inadequate consideration.	DRA asserts consideration need not be adequate; FMV can be used to determine actual consideration.	Yes, they were bargained-for exchanges; money/value exchanged for property.
May DRA base the tax on fair market value when the stated price is ten dollars?	Petitioner asserts no basis to compute tax from FMV absent enumerated circumstances.	DRA may audit and determine actual price by FMV under RSA 78-B:9, III.	Yes; DRA reasonably used FMV to determine actual consideration.
Is the tax scheme unconstitutional under the New Hampshire Constitution when applied to SPEs used in refinancing?	Taxation would be unjust, unequal, or non-proportional under Art. I, Art. II, and Art. II.	Tax applies uniformly to contractual transfers; SPEs used or not does not render it unconstitutional.	No constitutional violation; tax applies uniformly to contractual transfers and is proportionate.

Petition of Lorden, 134 N.H. 594 (N.H. 1991) (defined bargain for exchange; consideration includes value exchanged for real estate)
LaChance v. U.S. Smokeless Tobacco Co., 156 N.H. 88 (N.H. 2007) (statutory interpretation; plain meaning versus ambiguity)
Smith v. N.H. Dep't of Revenue Admin., 141 N.H. 681 (N.H. 1997) (constitutional and tax-equity analysis framework)
Estate of Gordon-Couture v. Brown, 152 N.H. 265 (N.H. 2005) (statutory interpretation and tax administration principles)
Appeal of Ashland Elec. Dept., 141 N.H. 336 (N.H. 1996) (contextual consideration of tax statutes)
Franklin v. Town of Newport, 151 N.H. 508 (N.H. 2004) (constitutional constraints on taxation; proportionality and uniformity)
Appeal of Town of Pelham, 143 N.H. 536 (N.H. 1999) (proportionality and fair tax administration principles)
S. N.H. Med. Ctr. v. Hayes, 159 N.H. 711 (N.H. 2010) (standards for appellate review of tax decisions and statutory interpretation)