When you transfer property using a deed in Florida, you'll have to pay a tax on the value of that transfer. The transfer tax is also referred to as a "deed stamp," because at one point in time, payment of transfer tax was signified by having the deed marked with a special stamp.
A Florida deed stamp is a required tax on the value of a property that is being transferred with the deed in question. The name itself is directly connected to the historical tradition of stamping a deed when transfer tax had been paid.
Exploring Taxable Transfers
The Florida deed transfer tax is also referred to as a "documentary stamp tax." The tax applies to both warranty and quitclaim deeds. It also applies to other real estate transfers, including mineral or timber rights, easements, and leasehold interest. The transfer tax is also due on deed-in-lieu of foreclosure transactions, contracts for deed, and assignments of contracts for deed.
Understanding Tax Rates
Florida has a state-wide deed stamp tax rate of 70 cents per $100 of value transferred. The one exception to this rate is in Miami-Dade County, where the basic tax rate is 60 cents per $100 of value for single-family residences, plus an additional 45 cents per $100 for anything other than a single-family home.
For instance, a $100,000 house would carry a $600 tax in Miami and a $700 tax in Fort Lauderdale or Orlando. A $200,000 three-plex's deed stamps would cost $1,400 in Fort Lauderdale or Orlando and $2,100 in Miami-Dade.
Evaluating Mortgage Taxes
In addition to paying taxes on recording a deed. Florida also imposes two taxes on mortgages. The mortgage amount is subject to a 35 cent per $100 tax for its deed stamp, then an additional non-recurring intangible tax that is valued at $.002 multiplied by the total value of the mortgage.
The tax applies only to the amount of the mortgage. If you take out a $90,000 mortgage on your $100,000 house, you'd pay $315 in mortgage deed stamp and $180 for the intangible tax, totaling $495. Both taxes are an unavoidable element of home ownership which cannot be avoided.
Understanding Payment Traditions
In Florida, sellers traditionally pay for deed stamps, and buyers pay the tax on their own mortgages, but these are rules of thumb. Florida's law doesn't distinguish between who pays the tax. The state primarily concerns itself with getting the revenue, and the payment of deed stamp tax can be negotiated between the parties.
Steve Lander has been a writer since 1996, with experience in the fields of financial services, real estate and technology. His work has appeared in trade publications such as the "Minnesota Real Estate Journal" and "Minnesota Multi-Housing Association Advocate." Lander holds a Bachelor of Arts in political science from Columbia University.