New Hampshire real estate transfer tax: rate and who pays

What is the rate, and who pays it?

The New Hampshire Legislature imposes the tax in RSA 78-B:1. The rate is $.75 per $100, or fractional part thereof, of the price or consideration. Where the price is $4,000 or less, there is a minimum tax of $20. The tax is computed to the nearest whole dollar.

Who pays is written into the statute, not left to custom:

• The purchaser must buy and attach the “indicia of tax paid” (the tax stamp approved by the Department of Revenue Administration) to the deed (RSA 78-B:4, I).
• The seller must do the same (RSA 78-B:4, II).
• “The rate of tax established in RSA 78-B:1 shall apply to both” of them (RSA 78-B:4, III).

So each party owes $0.75 per $100. The indicia must be attached to the deed before it is recorded, unless the deed states that the transaction is not subject to the tax (RSA 78-B:6). The register of deeds affixes them (RSA 78-B:5).

How much is it? Examples

The tax is $0.75 for each $100 of price, rounded up for any part of $100. Each party pays the amount below.

These are examples, not quotes. The price that counts is the full “price or consideration.” For most sales that is the contract price. For some transfers the law uses a different measure. For a deed given in lieu of foreclosure, for instance, consideration is the debt the transfer cancels plus any debt assumed (RSA 78-B:1-a, IV).

Is there a second, local transfer tax? The chapter creates one state tax, and it contains no county or city transfer tax. Also, the City of Manchester’s real estate tax pages describe only property taxes. Your closing statement will show exactly what is charged.

What transfers are exempt?

RSA 78-B:2 lists the transfers the tax does not apply to. The ones a home buyer or seller may meet:

• Transfers to the State, a county, a city, a town, a school district or a village district.
• A mortgage or other instrument that secures a debt, and the discharge of a mortgage.
• A deed that corrects an earlier deed.
• A deed given by a tax collector for property bought at a tax sale.
• Transfers that are gifts (no price, with donative intent, delivery and immediate relinquishment of control).
• Transfers at death by will, intestacy or joint tenancy.
• A transfer between spouses under a final divorce decree.
• A lease, including renewals, with a term of less than 99 years.
• A transfer on death deed under RSA 563-D where no consideration is exchanged.

Manufactured housing counts as real estate once it is placed on a site and tied into utilities (RSA 78-B:1, IV). Special payment rules apply to it (RSA 78-B:4, IV).

What paperwork is required?

Each side must file a separate declaration of consideration with the Department of Revenue Administration. The buyer and the seller sign their own forms, stating the price, within 30 days of the deed’s recording or the transfer, whichever is later (RSA 78-B:10, I and IV). The declaration is prima facie evidence of the price. The statute adds that failing to comply “shall not be construed to cloud title” (RSA 78-B:10, VI).

No declaration is needed for the exempt transfers in RSA 78-B:2, except gifts, which still need one (RSA 78-B:10, III).

Understating the price is costly. A party who writes that no tax is due, or attaches stamps for less than the real price, owes a civil penalty of 100% of the added tax, plus interest (RSA 78-B:7 and 7-a). The Department can audit transfers and, absent proof to the contrary, use fair market value to find the true price (RSA 78-B:9).

Recording charges are separate

The transfer tax is not the recording fee. At the registry of deeds, RSA 478:17-g sets $10 for the first page of a document plus $4 for each added page, and an additional $25 charge for each deed, mortgage, mortgage discharge or plan, which funds the land and community heritage program. The grantee pays the $25 on a deed. The borrower pays it on a mortgage. See closing costs in New Hampshire for a worked example.

For the rest of the year’s costs, see property tax in New Hampshire and the Manchester guide. A general walk-through of every line is in closing costs explained. If you sell at a profit, federal tax may apply as well: see capital gains on a home sale.