Transfer taxes are assessed when you sell a home, or any other real estate. A real estate sale is completed by transferring the rights of the property from the seller to the buyer through a deed. That deed is subject to transfer taxes.
This deed is then recorded in the public records of your local register’s office so that all of the world can see who owns the rights to a particular piece of property.
A transfer tax then is a tax on the amount of the sale or the value of the property (depends on the jurisdiction). This tax is collected by the local register’s office when the deed for the sale is recorded or placed in the public records.
How much a transfer tax will be is difficult to answer because the tax (here in the US) will vary from state to state, then from county to county and then even from city to city. After that, it may depend on the type of deed you are recording. In general however transfer taxes usually run from a few hundred to a few thousand dollars.
The title company, closing agent, attorney or realtor that you are using to facilitate your side of a real estate sale should be able to help you calculate local transfer taxes. If you are not using one of those, talk to your local register of deed’s office for assistance. If you are in Memphis, Tennessee like I am, you can determine your transfer taxes at this link.
Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors. Subscribe to Smarterlandlording here. Contact Kevin here.
