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Paying Stamp Tax When You Sell a Home

If you’re selling your home in Massachusetts or New Hampshire, it’s a good idea to know the costs up front so you won’t be surprised at the closing. Home sellers can expect to pay for such things as deed preparation, and in Massachusetts, a Title V Certificate if there’s a septic system, and a smoke detector certificate.

Many home sellers don’t realize they also have to pay a real estate transfer tax in Massachusetts and New Hampshire when they sell their home. Most states have some kind of real estate transfer tax. It’s sometimes called a “stamp tax” because years ago an actual embossed stamp had to be placed on the document to show that the tax had been paid. Adhesive stamps are now used on the document. Other names for this tax include deed stamp, excise tax, document stamp, and conveyance tax.

In most counties in Massachusetts, the tax is $4.56 per thousand. In Barnstable County is it higher, at $6.12 per thousand. So if you’re selling a home for $200,000, you will have to pay $912. In Barnstable County it would be $1,224.

Home buyers in Dukes and Nantucket Counties should be aware they will have to pay 2% of the home sale price which is then paid to the local land bank commission. This fee supports the acquisition of open space in the area for use by the public. First-time home buyers in Dukes County purchasing a home under $300,000 don’t have to pay this transfer fee.

There is a stamp tax in New Hampshire as well. The buyer and seller have to split the transfer tax at the rate of $.75 per $100 of the price.  So if you’re selling a $200,000 home in New Hampshire, the transfer tax would be $1,500.

How is the Transfer Tax Paid?

In Massachusetts the closing attorney will collect on the HUD Settlement Statement and pay the tax for you when they record the Deed at the Registry of Deeds in the county where the property is located. For a full list of the Registry of Deeds offices in Massachusetts, visit the Secretary of the Commonwealth of Massachusetts website.

In New Hampshire, the closing attorney will collect and pay the tax for you when they record the Deed at the Registry of Deeds in the county where the property is located. Visit the New Hampshire County Registries of Deeds website to find the Registry of Deeds for each county.  Remember to expect this when selling your home in Massachusetts or New Hampshire.

Sources:

An Act Relative to the Dukes County Land Bank

Nantucket Land Bank Rules and Regulations

Martha’s Vineyard Rules and Regulations Regarding the Processing of the Land Bank Transfer Fee

New Hampshire Dept. of Revenue

Massachusetts General Laws State Excise Stamp Tax