State Transfer Taxes

State Documentary Stamp Tax on DeedsThe documentary stamp tax on deeds is a one-time tax charged by the state when a property changes ownership. It is essentially a tax on the transaction itself, calculated based on the full purchase price of the property. Whether the buyer pays cash or gets a loan, the tax is levied on the total consideration paid for the home. In many states, it is customary for the seller to pay this expense because they are the party delivering the deed, although this can be negotiated in the contract. The tax is typically calculated by breaking the purchase price down into units (often per $100) and applying a specific tax rate to those units.