Selling a home in Florida can be expensive, and there are a lot of fees and costs to consider. One you might not have considered is the real estate transfer tax. This tax is levied on the transfer of property ownership and is an essential cost for sellers to consider. In Florida, transfer taxes can vary based on the location and specific details of the property transaction. Our guide will offer a look at how transfer taxes work in Florida. We will explore the different types of transfer taxes, who is responsible for paying them, and provide insights on possible exemptions and deductions.
Real estate transfer taxes are state or local taxes that are imposed when the ownership of a property is transferred from one person to another. According to the Federal Trade Commission, this tax is due when the title of a property—essentially the official rights to ownership—changes hands. This tax is a standard part of real estate transactions and is calculated based on the property’s sale price or assessed value. In Florida, this is referred to as a Documentary Stamp tax, though it is functionally the same as a real estate transfer tax. Transfer taxes are also sometimes referred to as a “mortgage registry tax” or “deed tax.” The specific amount owed in transfer taxes can vary significantly depending on the property’s location. Different states, counties, and cities will have their own rates and rules governing these taxes, so there’s no “one size fits all” solution. Transfer taxes are a way for local governments to generate revenue, supporting essential public services. These taxes are important to consider for anyone involved in a property transaction, influencing the overall cost of transferring property ownership. In the Sunshine State, all parties involved in the transaction are liable for the transfer tax when real estate changes hands, regardless of which party decides to pay the tax. It’s important to hammer out the details of the seller agreement to make sure that the transfer tax is paid—otherwise, you will be held responsible for fees and penalties. In the case of one party on the document being exempt from the state’s transfer tax, a non-exempt party involved in the transaction will be response for the fee.What are transfer taxes?
Who pays for transfer taxes?
