How to Transfer Tax for Recording a Deed
A transfer tax is a tax paid to the city, county and state government for transferring property to a new owner. The tax formulation is different for each state, but is usually figured using the consideration or purchase price of the property.
Other People Are Reading
Instructions
-
-
1
Determine the amount of tax to be paid. In South Carolina, for example, the formula for the transfer tax, also known as documentary stamps or deed stamps is $1.85 per $500 of consideration. This is the combined amount for city, county and state documentary taxes. For example, if the consideration is $100,000, the transfer tax is $370. This amount is paid directly to the County Register of Deeds.
-
2
Pay the transfer tax at the time of recording the deed. The executed deed, also known as a Title to Real Estate, is recorded in the Office of the Register of Deeds in the county where the property is located. For example, property in Isle of Palms, South Carolina is recorded in Charleston County Register of Deeds. The transfer tax is paid directly to the Office of the Register of Deeds at the time the deed is recorded. Depending on the state in which the property is located, there may be an additional fee to record the deed.
-
-
3
Distinguish the transfer tax from property tax. Once a deed is recorded in the new owner’s name, the new owner will receive the property tax notice for the following years. The deed must have the buyer’s name and mailing address in the text of the deed for the county treasurer to forward the new property tax notice. In South Carolina, property taxes are paid annually and include any taxes for town or city taxes. Transfer taxes are paid at the recording of the deed only, but property taxes are paid every year.
-
1
Tips & Warnings
As with all legal forms, a licensed and practicing attorney should review the deed before recording.
References
- Photo Credit Creatas/Creatas/Getty Images
