Who is responsible for paying the transfer tax in a real estate transaction?

In Pennsylvania, the responsibility for paying the transfer tax in a real estate transaction is typically shared between the buyer and the seller. This division is established by state law and can sometimes be modified by the terms negotiated in the sales contract.

Transfer tax is a state tax imposed on the transfer of real estate, and its allocation can vary depending on local customs or specific agreements made between the parties. However, the default position acknowledges that since both the buyer and seller are participating in the transfer process, each bears a portion of this tax liability.

This understanding is crucial for real estate practitioners and individuals involved in property transactions, as it impacts the total cost consideration in the buying and selling process. It is important to review the closing statement to clarify how the transfer tax is assessed and who is responsible for payment in any given transaction.