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Documentary Transfer Tax

Are there any exemptions from documentary transfer tax?

8 November 2022

Are there any exemptions from documentary transfer tax?

Yes. If the property is considered to have been sold there are several exemptions under the law. These exemptions relate to specific causes of real property transfers and are infrequently used.

Are there any other requirements?

8 November 2022

Are there any other requirements?

Yes. Each document transferring an interest in real property must clearly state, on its face, if the property is located in the county's unincorporated area or within a city's limits.

How do I show the amount of tax due?

8 November 2022

How do I show the amount of tax due?

Each document in which real property is sold must have a tax declaration on the first page of the document. 

How much is the documentary transfer tax?

8 November 2022

How much is the documentary transfer tax?

The tax rate is $.55 for each $500, or fractional part thereof, of the value of real property, less any loans assumed by the buyer.

What is considered anything of value?

8 November 2022

What is considered anything of value?

Examples of things other than money that have value are: shares of stock in a corporation, interest in a partnership, real property or assuming the debt of another person.

What is documentary transfer tax?

8 November 2022

What is documentary transfer tax?

A tax imposed on each recorded document in which real property is sold.

When is documentary transfer tax paid?

8 November 2022

When is documentary transfer tax paid?

The tax is paid at the time of recording a document transferring real property.

When is realty considered to not have been sold?

8 November 2022

When is realty considered to not have been sold?

Real property is considered to be sold when a transfer of an interest is for a valuable consideration, which may involve money or anything of value.

When is realty considered to not have been sold?

8 November 2022

When is realty considered to not have been sold?

The most used example is a bona fide gift. This exclusion is commonly used when adding or removing a co-signor from real property. Gift must be given as the explanation of no tax due. Other examples include: placing real property in a trust for the benefit of the grantor (revocable trust), distribution of partnership property when the partnership is dissolving, and changing how title is held (from joint tenancy to tenants in common).

Where can I go to get help in determining the amount of tax due?

8 November 2022

Where can I go to get help in determining the amount of tax due?

Contact a real estate or legal professional.

Who pays documentary transfer tax?

8 November 2022

Who pays documentary transfer tax?

Either the buyer or the seller upon mutual agreement.