Under Illinois law, which party is legally required to pay the Illinois state real estate transfer tax?
Correct Answer
B) The seller is primarily responsible under the statute, but the parties may contractually shift or allocate that obligation between themselves.
The Illinois Real Estate Transfer Tax Act (35 ILCS 200/31-25) places the primary obligation to pay the state transfer tax on the seller as the transferor. However, Illinois contract law permits the parties to negotiate and contractually allocate payment responsibility differently, and local custom in some markets may also influence who pays in practice. Licensees must distinguish between the statutory default (seller pays) and what the parties ultimately agree to in their contract.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A VA loan is a mortgage guaranteed by the Department of Veterans Affairs available to eligible veterans, active-duty service members, and surviving spouses. It offers no down payment and no private mortgage insurance requirements.
An adjustable-rate mortgage (ARM) has an interest rate that changes periodically based on market conditions, typically after an initial fixed-rate period. The rate adjustment is tied to a financial index plus a margin.
Closing costs are the fees and expenses paid by the buyer and seller at the closing of a real estate transaction, beyond the purchase price. They typically range from 2-5% of the purchase price.
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