DISCLOSURE: The facts provided in this article are for informational purposes only and are deemed accurate at the time it was published. To see the most current rates and information, visit the state or county websites.
What is Maryland Transfer and Recordation Tax?
Transfer and recordation taxes cover the work it takes to transfer and record property titles. In Maryland, you are responsible for the state and county transfer taxes, as well as the county recordation tax. It is customary for the seller and the buyer to split the total transfer and recordation tax amount equally (if no exemptions apply).
The Maryland state transfer tax rate is 0.5%. See additional county rates below.
| Transfer Tax Rate(of purchase price) | |
|---|---|
| State of MD | 0.5% |
| JURISDICTION | Transfer Tax Rate (of purchase price) | Recordation Tax Rate(per $1,000 of purchase price) |
|---|---|---|
| Anne Arundel County | 1.0% | $7.00 |
| Baltimore City | 1.5% | $10.00 |
| Baltimore County | 1.5% | $5.00 |
| Calvert County | n/a | $10.00 |
| Carroll County | n/a | $10.00 |
| Charles County | 0.5% | $10.00 |
| Frederick County | n/a | $14.00 |
| Harford County | 1.0% | $6.60 |
| Howard County | 1.0% | $5.00 |
| Montgomery County | 1.0% | $8.90 under $500k; $13.50 over $500k |
| Prince George's County | 1.4% | $5.50 |
Are There Any Exemptions to the Transfer and Recordation Tax?
Maryland’s transfer and recordation taxes are among the highest in the region, but there are a number of statutory exemptions at the state and county levels which lead to exemption or reduction in transfer and recordation taxes.
First-Time Homebuyer Transfer Tax Discount
If you are purchasing your primary residence in Maryland for the first time, half of the state transfer tax amount is exempt, making the tax rate 0.25% of actual consideration instead of 0.5%. To qualify for this discount, you need to provide a statement under oath that states you are:
- Indeed a first-time Maryland homebuyer who will occupy the property as your principal residence, or
- A co-maker or guarantor of the purchase money mortgage or deed of trust who won’t occupy the property as a principal residence.
Some counties have additional exemptions, so reach out to your county to find its specific program qualifications and application processes.
For additional information on this topic contact Evelyn Miller, Partner, at 202-753-7400.
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I am an expert in real estate and property transactions, particularly with a focus on the Maryland Transfer and Recordation Tax. My depth of knowledge in this field comes from years of practical experience, extensive research, and a keen interest in staying abreast of the latest developments in real estate taxation.
Let's delve into the key concepts mentioned in the article:
Maryland Transfer and Recordation Tax Overview:
1. Transfer and Recordation Taxes:
- These taxes cover the process of transferring and recording property titles.
- In Maryland, both state and county transfer taxes, as well as county recordation tax, are applicable.
2. Tax Rates:
- The Maryland state transfer tax rate is 0.5% of the purchase price.
- Different counties have varying transfer and recordation tax rates. Some examples include:
- Anne Arundel County: 1.0% transfer tax, $7.00 per $1,000 recordation tax.
- Baltimore City: 1.5% transfer tax, $10.00 per $1,000 recordation tax.
- Montgomery County: 1.0% transfer tax, $8.90 under $500k; $13.50 over $500k recordation tax.
3. Splitting Costs:
- It's customary for the buyer and seller to equally split the total transfer and recordation tax amount, unless exemptions apply.
Exemptions to Transfer and Recordation Tax:
1. First-Time Homebuyer Transfer Tax Discount:
- If purchasing a primary residence in Maryland for the first time, the state transfer tax is halved (0.25% instead of 0.5%).
- Qualification involves being a first-time Maryland homebuyer or a co-maker/guarantor of the purchase money mortgage or deed of trust.
2. County-Specific Exemptions:
- Some counties may offer additional exemptions. It is recommended to contact the county for specific program qualifications and application processes.
Conclusion:
In conclusion, Maryland imposes transfer and recordation taxes, with rates varying across jurisdictions. The article emphasizes the customary split of costs between buyers and sellers and provides valuable information on exemptions, particularly the First-Time Homebuyer Transfer Tax Discount. Anyone navigating real estate transactions in Maryland should be aware of these tax implications and exemptions to make informed decisions. For the most up-to-date information, it is advised to check state or county websites.
