Here are some examples of how much real estate transfer taxes can cost: You’ll see this in places like Washington, New Jersey, the District of Columbia and Hawaii. Real estate transfer taxes are usually based on a small percentage of the property’s value, but in areas where real estate values are high, taxes can add considerable sums to closing costs. How Much Can Real Estate Transfer Taxes Cost? Possibilities include conservation or open space protection, low-income and affordable housing programs, public transit, bridges, sidewalks, parks and schools.
Governments can use the money in various ways. In Pittsburgh, the municipality gets 3%, the school district gets 1% and the state gets 1%. For example, in New Jersey, the state and the counties share the proceeds of the 1% tax. Real estate transfer taxes go to the government, but which government entity gets the money and how much they get varies by location. In Central California, it can be a combination of both the buyer and seller. Customarily, the seller pays the tax in Southern California while the buyer pays it in Northern California, according to Viva Escrow, a Southern California escrow company.Philadelphia suggests the buyer and seller split the 4.278% tax, but says it’s not a legal requirement.In Delaware, the party transferring the property and the party receiving it are supposed to split the tax.Here are some examples based on specific locations. Depending on the jurisdiction, the tax may be paid by the buyer or seller, or both.
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