One crucial cost to consider when selling a home in Tennessee is the real estate transfer tax. This tax is levied on the transfer of property ownership, and the specifics can vary based on location. In this guide, we’ll dig into the workings of transfer taxes in Tennessee. We’ll cover who is responsible for paying these taxes, the different types involved, and what you, as a seller, can expect to pay when you transfer property ownership in Tennessee. Real estate transfer taxes are levied by state or local governments when the ownership of a property changes hands. As defined by the Federal Trade Commission, these taxes are applicable whenever the title of a property—essentially the legal documentation of ownership—is transferred from one person to another. This process triggers a tax obligation that varies depending on the location of the property. The specific rate and regulations are determined by local state, county, or city ordinances. Transfer taxes serve as a crucial source of income for governments, helping to fund public services and infrastructure. The amount owed in transfer taxes can significantly impact the total cost of a property transaction. These taxes are calculated based on the property’s sale price or its assessed value, depending on local laws. To understand how these taxes will affect a transaction in your area, consider them an essential part of budgeting for property sales. In Tennessee, the buyer is responsible for paying the state’s realty transfer tax, (also sometimes referred to as the “grantee”. However, exemptions may apply, which we will discuss later in this article.What are transfer taxes?
Who pays for transfer taxes?
