Massachusetts real estate transfer tax

tax3“The only things certain in life are death and taxes.” — Benjamin Franklin

Massachusetts Deed Stamps / Transfer Tax

Much to every Massachusetts home sellers’ chagrin, there is a state tax on selling your home. Sometimes called deed stamps, transfer tax or excise tax, it’s a tax nevertheless, and sellers must pay it at closing. For every Massachusetts county except Barnstable and the Islands, the tax is $4.56 per thousand of the purchase price on the deed. For example, for a $500,000 purchase, the seller must pay $2,280 in taxes. That’s not chump change! In Barnstable County, the tax is $5.70 per thousand. Dukes (Martha’s Vineyard) and Nantucket counties charge an additional 2% land bank fee.

On the HUD-1 Settlement Statement, the transfer/deed tax will appear on line 1203.

The tax does not apply to transactions up to $100.00. That is why most “gift” transfers or between husband and wife recite consideration for $10.00 or the like, so as to avoid the deed/transfer tax.

Sellers, make sure you factor in this transfer tax, as well as the broker commission, when calculating the amount of your sale proceeds.

Click here for a handy Massachusetts deed / transfer tax calculator.