A Massachusetts deed is recorded showing a sale price of $415,500. When calculating the deed excise tax at $2.28 per $500, how should the $415,500 be treated for purposes of determining the number of taxable units?
Correct Answer
C) Divide $415,500 by $500 to get 831 full units, ignoring the remaining $500 fraction
Under MGL Chapter 64D, the deed excise tax is assessed on each $500 or fraction thereof. $415,500 ÷ $500 = 831 with no remainder (831 × $500 = $415,500 exactly), yielding 831 units. However, the principle to remember is that any fraction of $500 is rounded UP to the next full unit. In this case, $415,500 ÷ $500 = 831.0 exactly, so 831 units apply. The rule of rounding up any fraction is the key Massachusetts-specific requirement tested here.
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