Understanding North Carolina’s Transfer Tax: A Quick Guide
If you’re planning to sell your home in North Carolina, you’ll want to have a strong understanding of North Carolina’s transfer tax. Transfer taxes are fees imposed by the state, county, or city when property ownership is transferred from one party to another.
This guide will explore the complexities of transfer taxes in North Carolina, detailing what sellers should anticipate in terms of cost, exemptions you may be eligible for, and provide you with some tools to assist you when selling your North Carolina home.
What are transfer taxes?
Real estate transfer taxes are levied by state or local governments when the ownership of a property is officially transferred from one person to another. According to the Federal Trade Commission, this tax is applicable once the title of the property—the legal documentation that confirms ownership—is handed over to a new owner.
The amount of transfer tax owed can vary significantly depending on where the property is located, as different states, counties, and cities have their own specific regulations and rates.
These taxes serve a vital role in local and state economies; they generate revenue that funds public services and infrastructure projects, contributing to the overall financial health of the community.
Who pays for transfer taxes?
In North Carolina, the responsibility for paying transfer taxes generally falls on the seller of the property. However, they can negotiate the final terms and responsibility with the buyer as long as the terms are specified and included in the purchase agreement.
