What is deed tax

Deed tax, also known as transfer tax, is a tax imposed on the transfer of real estate property. This tax is typically levied by state or local governments and is calculated based on the value of the property being transferred. The deed tax is typically paid by the seller at the time of the property transfer, although in some cases it may be split between the buyer and seller. The deed tax is used to generate revenue for the government and is often used to fund local infrastructure and public services. The rate of the deed tax can vary significantly from one jurisdiction to another, and in some cases, it may be a flat fee rather than a percentage of the property's value. In addition to the deed tax, there may be other taxes and fees associated with the transfer of real estate, such as recording fees and mortgage taxes. It's important for buyers and sellers to be aware of these costs when entering into a real estate transaction, as they can significantly impact the overall cost of the transfer. Overall, deed tax is an important consideration in real estate finance, and understanding how it is calculated and who is responsible for paying it is essential for anyone involved in buying or selling property.