A home in a California charter city sells for $1,500,000. The city imposes its own real property transfer tax of $6.80 per $1,000 of value, and the county documentary transfer tax of $1.10 per $1,000 applies in addition to it. What is the total combined transfer tax due at closing?
Correct Answer
C) $11,850
Each tax is applied to the full price, measured per $1,000 of value. County documentary transfer tax under Revenue and Taxation Code §11911: $1,500,000 divided by $1,000 is 1,500 units, times $1.10, equals $1,650. City transfer tax: 1,500 units times $6.80 equals $10,200. The combined total due at closing is $1,650 plus $10,200, or $11,850. A charter city may levy its own transfer tax under its home rule authority, and where it does the county tax is not reduced, so both are owed on the same sale; which party pays is settled by negotiation in the purchase contract rather than by statute.
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A transfer tax is a tax imposed by state, county, or local government on the transfer of real property from one owner to another. It is typically based on the sale price or a flat rate per dollar of consideration.
An abstract of title is a condensed history of all recorded documents and proceedings that affect the title to a specific parcel of real property. It is a summary, not a guarantee, of title condition.
Actual notice means a person has direct, personal knowledge of a fact or interest in real property. This can come from being told, seeing something firsthand, or any form of direct awareness.
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