Delaware Real Estate Transfer Taxes: An In-Depth Guide (2024 Update)

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By Jon Stubbs Updated March 14, 2024

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Who pays transfer taxes? | When are transfer taxes paid? | Methodology

Delaware's current transfer tax rate is $4.00 per $100. So, for a house worth $389,157 — the median home price in the state — the transfer tax due will be $15,566.

The specifics on who pays the transfer tax in Delaware are sometimes up for negotiation, but usually the buyer and seller split the cost.

If you want to mitigate the cost of your Delaware transfer taxes, Clever Real Estate has a solution! Our concierge team will partner you with a local expert who can negotiate the best deal for you — they may even be able to get the other party to shoulder the entire transfer tax dues.

💰 Find an agent who can negotiate your transfer taxes

You can't change transfer tax rates. But, an experienced Clever Real Estate agent can help you win the negotiation battle so you aren't stuck paying all of the transfer taxes on your own.

When you choose Clever, you'll work with a full-service realtor with transfer tax expertise in your local market.

Clever's service is totally free, with zero obligation — you can walk away at any time.

Here's everything property owners, buyers, and sellers need to know about Delaware real estate transfer tax.

What are real estate transfer taxes?

Real estate transfer taxes are charged when property changes hands. It's a percentage of either the sale value or assessed value of your property, depending on what state you're in. Thirty-five states and the District of Columbia have transfer taxes.

Real estate transfer taxes are also known as real estate conveyance taxes, mortgage transfer taxes, documentary stamp taxes, and property transfer taxes. Transfer taxes are used for filing purposes and help fund land developments and HUD properties and programs.

Transfer taxes can vary on a regional, state, and local level, so it's important for buyers and sellers to work with an experienced real estate agent to ensure they completely understand the transfer tax process before buying or selling property.

If you're buying property, selling property, or have inherited property, transfer taxes in your state and county are something you need to be familiar with. Speak to a Clever Partner Agent about other tax savings for buyers and sellers. They will also be able to guide you to a host of government programs and grants that can cut down on your closing costs.

Learn More: What is real estate transfer tax? (and Who Pays It?)

How much are transfer taxes in Delaware - and who pays?

Transfer taxes in Delaware are 4% of the purchase price of the property, with 2.5% going to the state and 1.5% going to the county. Common practice is for the buyer and seller to split the transfer tax costs evenly, with both the buyer and seller paying 2%.

First-time buyers in Delaware typically qualify for state-level exemptions. For example, Delaware first-time buyers automatically qualify for a state transfer tax exemption on a purchase price up to $400,000. First-time buyers purchasing property worth more than $400,000 will pay 1.25% of the amount above $400,000.

In this case, the first-time buyer would still be responsible for paying a 0.75% transfer tax to the county, while the seller would still be responsible for their full 2% share (1.25% to the state and 0.75% to the country).

There’s no way around paying this cost, but a skilled real estate agent can help you negotiate for a lower tax burden.

If you work with Clever, you’ll save even more money from our low fees — sellers only pay a 1.5% listing fee (compared to the national average of 2.83%). The savings you make can help recoup the cost of some of your tax dues.

Save money, pay your taxes, win big

Transfer taxes are a necessary evil when selling a home. But the good news is there are ways to save on home selling costs that can lessen the blow.

When you find your agent through Clever's free matching service, you get a pre-negotiated 1.5% listing fee — half the usual rate.

Clever's service is free with no obligation. Try Clever today!

Learn More About How to Save With Clever

Can you deduct transfer taxes?

Yes and no.

Unfortunately, transfer taxes are not tax-deductible for the buyer or the seller, unless the property is an investment property. However, property owners can include transfer taxes in the "cost basis" of the property (the amount you paid to acquire it).

In this situation, sellers can deduct the tax from the effective sale price of the home when computing the capital gain or loss. Raising the cost basis of the home decreases the capital gain on the sale. This will help reduce the seller's tax burden.

There is also an exemption to the no deduction rule - if the property being taxed is a rental home or real estate investment, transfer taxes can be deducted as a work expense.

When do you pay transfer taxes in Delaware?

Transfer taxes are paid at the closing of a deal, and in most cases are paid by the seller. So, when you're filing your taxes, sellers should be sure to deduct the transfer tax from their capital gain.

This is especially important because capital gains tax is paid to the federal government and the transfer tax is paid to the state government. So, chances are, you'll be paying both these taxes separately, and at different times.

Delaware transfer taxes summary

While you now know the basics of Delaware transfer taxes, actually computing and paying for them can be a difficult task. A local expert can make the process easier, as they know the ins and outs of transfer taxes, and will also ensure you get the best deal possible out of your transaction.

Clever can help you find the best local agent to assist you. Our partner agents come from the biggest names in real estate, like Keller Williams, Century 21, and RE/MAX — so you know they have the experience and knowledge to give you the best service.

We’ll partner you with a local real estate agent who knows how to deal with the state’s tax and helps negotiate a deal in your favor. What’s more, our agents charge only a 1.5% listing fee compared to the state average of 2.44%! The money you'll save can more than offset the cost of the transfer taxes.

» SAVE: Learn more about how a Clever agent can help you navigate Delaware transfer taxes

Methodology

  • Transfer tax amounts are based on government website information as of February 2024.
  • We gathered our listing commission rate data from a December 2023 survey of 630 of our partner agents.
  • Home values, list prices, and sale prices are based on Zillow data as of April 2024.

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Our experts continually research, evaluate, and monitor real estate companies and industry trends. We update our articles when new information becomes available.

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