James is selling his home in Snowmass Village, Colorado for $1,200,000. The Town of Snowmass Village imposes a real estate transfer tax of 1% on the sale price, paid by the buyer. In addition, Colorado charges a documentary fee of $0.01 per $100 of consideration (rounded to the nearest dollar) on all real property transfers, which is collected at closing. What is the combined total of the Snowmass Village transfer tax and the Colorado documentary fee that will be collected at closing for this transaction?
Correct Answer
A) $12,120
Step 1 — Snowmass Village Transfer Tax: Sale price × 1% = $1,200,000 × 0.01 = $12,000. Step 2 — Colorado Documentary Fee: $0.01 per $100 of consideration = $1,200,000 ÷ 100 × $0.01 = 12,000 × $0.01 = $120. Step 3 — Combined Total: $12,000 + $120 = $12,120. Colorado imposes a documentary fee (sometimes called a filing fee) of $0.01 per $100 of consideration under C.R.S. § 39-13-102, collected at closing and paid to the county clerk and recorder. This is separate from any local transfer tax.
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Maria is purchasing a condominium in Telluride, Colorado for $850,000. Her real estate broker informs her that a transfer tax will apply to the transaction. Which of the following statements correctly explains the source of this transfer tax obligation?
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