Who pays transfer taxes? | When are transfer taxes paid? | Methodology
North Carolina's current transfer tax rate is $1 per $500. So, for a house worth $322,527 — the median home price in the state — the transfer tax due will be $645. Certain counties charge an additional land transfer tax of 1% of the sale price.
The specifics on who pays the transfer tax in North Carolina are sometimes up for negotiation, but usually the seller is responsible.
Clever Real Estate can help you cut costs here — our concierge team will partner you with an experienced agent who can help you negotiate a good deal with your buyer on transfer taxes. Not to mention, you'll save big by paying only 1.5% in commission.
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.
Who pays transfer taxes in North Carolina: The buyer or the seller?
In North Carolina, usually, the seller is responsible for paying the transfer tax.
However, if the buyer and seller are up for negotiating terms during the selling and buying process, you can ask that the buyer pay a portion or all of the transfer tax.
How much are transfer taxes in North Carolina?
When ownership in North Carolina real estate is transferred, an excise tax of $1 per $500 is levied on the value of the property. For example, a $600 transfer tax would be imposed on the sale of a $300,000 home.
Transfer taxes in North Carolina are typically paid by the seller. Seven counties in North Carolina are authorized to impose an additional land transfer tax of up to 1% of the sale price. Only seven counties in North Carolina levy a local excise tax on the transfer of real estate. They are:
- Camden
- Chowan
- Currituck
- Dare
- Pasquotank
- Perquimans
- Washington
Transfer taxes are non-negotiable, however, you can save enough money to offset the cost by using a Clever partner agent.
By using a Clever agent, you pay a listing fee of 1.5%, which is a much lower rate than the nationwide average of 3%. Your savings will cover the transfer tax fees, and you’ll also get to take home a larger cut of the sales profit post-taxes.
North Carolina transfer tax exemptions
There are circumstances where there is no transfer tax needed. Some of these are deeds of gift, foreclosure deeds, deeds from local, state, or federal government, and certain leases with a term of fewer than 10 years.
When do you pay transfer taxes in North Carolina?
Transfer taxes are paid at the closing of a deal, and in most cases are paid by the seller.
Can you deduct transfer taxes?
We are all typically looking for ways to make tax deductions. While there are many things homeowners can do to maximize their tax deductions, such as utilizing property taxes, transfer taxes is not one of them. This is because the IRS does not consider transfer taxes as a "sales tax."
However, as a seller, you can include the transfer tax on the cost basis of your property. The way this works is when you sell your house, the goal is to walk away with a profit. This profit is going to be taxed by a capital gains tax. The amount you spent on the transfer tax can be taken from your profit so that your capital gains tax bill can be reduced.
The good news is that you won't even need to make this reduction if you owned the home for more than two years. A married couple who lived in the house for two of the last five years could exclude $500,000 of capital gains.
North Carolina transfer tax summary
Although you now know the basics of North Carolina transfer taxes, there can still be situations that can complicate your sale. For example, if you're selling a house within the seven counties that have additional transfer taxes, things can get confusing.
Having a professional to guide you will make the sale easier to deal with — and doing so might even help you cut on some overhead costs.
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 2.88%! 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 North Carolina 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 February 2024.
