{"id":19237,"date":"2025-01-21T06:36:09","date_gmt":"2025-01-21T14:36:09","guid":{"rendered":"https:\/\/www.homelight.com\/blog\/?p=19237"},"modified":"2025-05-29T08:32:06","modified_gmt":"2025-05-29T15:32:06","slug":"real-estate-transfer-tax","status":"publish","type":"post","link":"https:\/\/www.homelight.com\/blog\/real-estate-transfer-tax\/","title":{"rendered":"Real Estate Transfer Taxes: What Is This Little-Known Extra Cost to Sell Your Home?"},"content":{"rendered":"

The act of selling a house costs money. So even though you\u2019re the one getting a big check, you\u2019ll also receive a closing statement<\/a> listing all of the charges you owe (how fun, right?)<\/p>\n

One little fee tacked onto your final settlement is the real estate transfer tax, also known as a deed transfer tax<\/a>, stamp tax, conveyance tax, or documentary transfer tax \u2014 and it\u2019s not one many sellers instantly recognize.<\/p>\n

Ultimately, the purpose of this tax is the same as others: to generate revenue for your state, county, or city (and sometimes all three).<\/p>\n\n\n\n\n\n

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\n \"homelight\n <\/div>\n \n

Step one: Talk to an expert!<\/h3>\n

Selling your house soon? Connect with a top agent near you to get an expert opinion on how much your house will sell for, what to fix before listing, and the latest local housing market trends.<\/p>\n \n

\n Learn More<\/a>\n <\/div>\n <\/div>\n<\/div>\n\n\n

\u201cIn California, it\u2019s a fact of life,\u201d says Brett Wasserman<\/a>, a partner who handles real estate law at the legal offices of Marc Bronstein in Santa Monica, California. \u201cWhen you have cities and states that have lots of services that they provide, they have to raise that revenue somehow.\u201d<\/p>\n

First, we\u2019ll take a look at this particular line item in your closing costs<\/a> in the hope that a better understanding of this fee makes it less mentally taxing. Once you\u2019ve got a firm foundation, consult our comprehensive chart with a list of the transfer tax rates across all 50 states.<\/p>\n

<\/div>What are real estate transfer taxes?<\/h2>\n

A real estate transfer tax is a fee you pay to a state, county, or municipality for \u201cthe privilege of transferring real property within the jurisdiction<\/a>.\u201d<\/p>\n

Depending on where you live, the tax can be a flat fee or an amount specified per every $100, $500, or $1,000 of the transferred property value. (Wasserman describes that as exclusive of any liens.) For example, Arizona charges a flat fee of $2<\/a> while West Virginia charges $1.10 for each $500 value<\/a>.<\/p>\n

Most fees range from under a dollar per $100 or $500 to roughly $1 to $3 per $1,000 of the transferred net value. California\u2019s Revenue and Taxation Code charges $1.10 per $1,000 of the transferred net value, or 55 cents per $500, Wasserman says.<\/p>\n

Municipalities also have the ability to levy additional transfer taxes. In Los Angeles County, for instance, five cities charge an additional fee: 0.45% to 5.95%<\/a> for Los Angeles; 0.045% to 0.4% for Culver City<\/a>; 0.3% to 5.6% in Santa Monica<\/a>; and $2.20<\/a> per $1,000 for Pomona and Redondo Beach.<\/p>\n

San Francisco\u2019s fees<\/a> vary based on the net sale price, ranging from 0.5% for property up to $250,000 and 6.0% for property that nets more than $25 million.<\/p>\n

So if you sold a Santa Monica beach property for $2 million, you\u2019d owe $2,200 to Los Angeles County and $6,000 to the City of Santa Monica \u2014 a total of $8,200 in what the state calls \u201cdocumentary transfer tax.\u201d<\/p>\n

No wonder your real estate agent needs a calculator handy<\/a>!<\/p>\n

What\u2019s more, some states charge additional transfer taxes based on an area\u2019s population<\/a> or vary the rate depending on whether the property being transferred is residential or agricultural.<\/p>\n

<\/div>Who pays transfer taxes at closing: the buyer or seller?<\/h2>\n

In the above example, the seller is on the hook for paying real estate transfer tax. But the municipality decides who pays what. Sometimes, the buyer pays this tax, sometimes the seller does, and sometimes a buyer and seller split the cost.<\/p>\n

In Chicago, Illinois, for example, the buyer pays $3.75 per $500 of the net sale while the seller pays $1.50 per $500 \u2014 a total of $5.25 per $500<\/a> of each sale, according to Craig Fallico<\/a>, a veteran real estate agent serving the Chicago suburbs.<\/p>\n

Real estate transfer tax is something both parties can negotiate<\/a>, much like other charges when selling a house<\/a>. The county recorder technically doesn\u2019t care who files the fee, as long as it\u2019s paid when the paperwork is filed.<\/p>\n","protected":false},"excerpt":{"rendered":"

One fee tacked onto your final settlement is the real estate transfer tax. Find out how much your state charges with our easy chart.<\/p>\n","protected":false},"author":76,"featured_media":38797,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"cybocfi_hide_featured_image":"","footnotes":""},"categories":[343,319],"tags":[],"class_list":["post-19237","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finances","category-selling-advice"],"acf":[],"yoast_head":"\nReal Estate Transfer Taxes: Find Out What You'll Be Charged<\/title>\n<meta name=\"description\" content=\"One fee tacked onto your final settlement is the real estate transfer tax. 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