Georgia real estate transfer tax: rate, who pays, example

What is the Georgia transfer tax rate?

The Department of Revenue describes the real estate transfer tax as an excise tax on a sale in which title passes from seller to buyer. It is based on the sale price. The rate is:

• $1 for the first $1,000, or fraction of $1,000, and
• 10 cents for each additional $100, or fraction of $100.

In plain terms, that is about $1 per $1,000 of price. The pages I read from the Department of Revenue and the court clerks’ authority give one statewide rate. They do not list a separate county or city add-on, so ask the Clerk of Superior Court where the property sits if you want to confirm there is none.

The tax is not a property tax. The Georgia Superior Court Clerks’ Cooperative Authority says the clerk will not record the deed until the tax is paid, and the clerk then attaches a certificate that it has been paid.

Who pays the transfer tax?

By statute, the tax must be paid by the person who signs the deed or by the person for whose benefit it is signed. The Department of Revenue states it plainly: “The seller is liable for the real estate transfer tax, though frequently the parties agree in the sales contract that the buyer will pay the tax.” The clerks’ authority says the same: the seller pays unless the contract says otherwise.

So the contract, not the law, decides who actually pays. Check that line before you sign, and see how it fits with the other costs in Georgia closing costs.

Example: a $400,000 home in Atlanta

This is an illustration, not a quote. It assumes a $400,000 sale price and a $320,000 mortgage, in Atlanta (Fulton County).

At a $300,000 price, the transfer tax is $300, since each $1,000 adds $1. The intangible tax grows with the loan, not the price: a $250,000 loan produces $750.

What is the intangible recording tax?

When you borrow to buy, the lender holds a security instrument that must be recorded in the county where the property sits. Before recording, the lender must pay the intangible recording tax:

• $1.50 for each $500, or fraction of $500, of the face amount of the note.
• A maximum of $25,000 on any single note.
• A penalty of 50% of the tax plus 1% interest per month if it is not paid on time.

The Department of Revenue says the holder of the note may pass the tax on to the borrower, but it cannot be treated as a finance charge on the loan. In practice, expect to see it on your Loan Estimate and Closing Disclosure, the federal forms described in closing costs explained. In most counties, the clerk of superior court collects it; in a few smaller counties, the tax commissioner does.

Are any transfers exempt?

Some documents need no filing at all. The clerks’ authority lists these as not requiring the PT-61 transfer tax form:

• Security deeds and other writings that secure a debt (O.C.G.A. 48-6-2).
• Releases of a security interest, including quitclaim deeds that release one.
• Certain leases of land or other real estate (not estates for years).
• Affidavits such as an “in aid of title” affidavit, which do not convey property.

The authority adds that other transactions, such as some quitclaim deeds, still require the PT-61 form but may be exempt from paying the tax. It does not list those exemptions on the pages I read. If you are transferring a home by gift, between spouses or in a divorce, ask the clerk of superior court before recording.

What else does the clerk charge?

Recording fees are separate from the tax. The Fulton County clerk’s schedule lists $25.00 for deeds or any instrument pertaining to real estate, and $25.00 for a cancellation, satisfaction, release or assignment. Other counties publish their own schedules.