Q: There is a one page addenda called the First-time Maryland homebuyer Transfer and Recordation Tax Addendum. Section III
Under Section III, we said buyer and seller to pay equally. Do we split .25% if the buyers qualify as a first-time homebuyer. Or, does the seller pay the .25%. If you cannot answer, please refer this question to a real estate attorney. I have been trying to get an answer for hours! It is a standard form!
A: There are 3 different transfer and recordation taxes in Maryland.
One of these taxes (state transfer) is .5% and is affected by the status of the buyer as a 1st time homebuyer. That tax is dropped in 1/2 to .25% for a first time homebuyer, and the Seller must pay ALL of that tax.
With respect to the other 2 transfer / recordation taxes, the parties can decide how to allocate - if the contract says split equally, then the other 2 taxes (which rates vary from county to county) are split in half. Note that these other taxes may be 1-2.5% of the total purchase price (again, it varies by county and some counties have rules that allow a different tax rate on a portion).
Your title company should be able to provide a breakdown of the total taxes. The local county should also be able to confirm tax rates.
While not legal advice specific to your situation I hope that this general information on taxes helps.
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.