On January 27, the U.S. Court of Appeals for the Fourth Circuit upheld a district court decision and held that Fannie Mae and Freddie Mac are exempt from state and local real estate transfer taxes. Montgomery County, Md. v. Fed. Nat. Mortg. Ass’n, No.13-1691/1752, 2014 WL 279852 (4th Cir. Jan. 27, 2014). In this case, as in other similar cases around the country, Maryland and South Carolina counties sued to recover state and local real estate transfer taxes from Fannie Mae, Freddie Mac, and FHFA for property transfers made by those entities. The court held that Congress expressly exempted Fannie Mae and Freddie Mac from “all taxation,” including all state and local taxation, when it chartered those institutions and, in a footnote, explained that, as conservator stepping into the shoes of Fannie Mae and Freddie Mac, the same exemption applies to FHFA. The court rejected the counties’ argument that the state and local taxes imposed on transfer and recordation of real property fell within the real property tax exclusions from the general tax exemption provision of Fannie Mae and Freddie Mac’s respective charters. The court added that Congress specifically carved out real property taxes from the “all taxation” exemption, but that the types of transfer taxes at issue in this case were distinguishable from a real property tax. The court affirmed the district court’s judgment in favor of Fannie Mae, Freddie Mac, and FHFA.