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Massachusetts Home Buyer Guide

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Do Massachusetts Home Buyers Pay Taxes When Buying a Home?

Apr 6, 2021 5:42:00 AM

No, Massachusetts home buyers do not pay taxes on the purchase of real estate, but home sellers do pay something called tax stamps.

Massachusetts taxes for real estate salesThe Commonwealth of Massachusetts derives revenue from the sale of real estate through state excise tax stamps. The tax stamps in most counties are $4.56 per $1000 of the sales price.

For example, a home sold for $400,000 in most counties would result in the seller paying tax stamps in the amount of $1,824 (400 x $4.56 = $1,824). Tax stamps are paid at the Registry of Deeds in the county where the property is located, and the deed cannot be recorded until the registry confirms the receipt of the tax stamps payment. Sellers can find the amount of the transfer tax on their closing disclosure.

There are a few Massachusetts counties that charge more for tax stamps and the transfer of real estate. For example, Barnstable County (Cape Cod area) charges $6.48 per $1000. Dukes County (Martha's Vineyard) and Nantucket County charge the same $4.56 per $1,000 as other counties but add a 2 percent land bank fee.

Nantucket and Martha's Vineyard use the funding from land bank fees to acquire and manage land for open space, agriculture, and recreational uses.

In New Hampshire, the buyer and the seller share the cost of what the state refers to as the Real Estate Transfer Tax. The home buyer and the seller pay a tax rate of $0.75 per $100, or $7.50 per $1,000 each, so the same $400,000 sale would cost the home buyer $3,000 in taxes and the same for the seller.

In Rhode Island, the seller pays a transfer tax of $2.30 per $500, or $4.60 per $1,000.

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Topics: Home-buying Tips, Real Estate Misc., Massachusetts Relocation, Real Estate Law, Boston Relocation

   

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