REAL ESTATE TRANSFER TAXES ON WARRANTY DEED
In the state of Arkansas, the "revenue tax" that you see on Warranty Deeds is based on a total of 3.3% of the sales price; so on a $100,000 transaction, the buyer and seller would each pay a combined amount of $330.00 at closing for this tax. This amount is customarily split between the buyer and the seller unless the contract stipulates that it be handled differently.
There are a number of instances when this "tax" can be exempt. For example, if you have a sales price that is $60,000 or less and the buyer is getting a FHA or VA loan, then they can be "revenue exempt", which means that the entire transaction will be exempt, helping eliminate this cost to buyer and seller, --provided the buyer nor the spouse of the buyer has not owned a home within three years of the closing date. The buyer is required to sign a form at closing stipulating these facts (to be recorded with the Warranty Deed) and the reason for the exemption.
You can check with the Revenue Office for a complete list of exemptions, but a few others are:
**No tax would be due on certain family transactions or gift transactions where the consideration was less than $100.00;
**Transfers to or from the United States, the state of Arkansas, or certain agencies or political subdivisions;
**A re-recorded instrument;
The revenue tax charges have fluctuated throughout the years, but 3.3 per thousand based on the sales price is what is currently being charged in the state of Arkansas.
Comments(5)