Real Estate Terms Glossary
What is a Transfer Tax?
We can define a transfer tax as a state or local tax that’s charged as a specific percentage of the total property value in a real estate transfer. So, transfer tax is any tax you pay when the title to a piece of property, such as real estate, changes hands from one owner to the other. These taxes may be imposed by a county, state, or municipality.
This tax is imposed when the property title is transferred to the name of the new owner.
Examples of Transfer Tax
- Example 1: Capital gains tax
- Example 2: Estate tax
Here’s Investopedia’s definition of Transfer Tax .
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