A home in Oakland County, Michigan sells for $400,000. Calculate the total real estate transfer tax (state + county) that the seller must pay at closing.
Correct Answer
B) $3,440
Michigan imposes two transfer taxes, both paid by the seller: (1) State transfer tax: $7.50 per $1,000 of value. $400,000 ÷ $1,000 = 400 units × $7.50 = $3,000. (2) County transfer tax: $1.10 per $1,000 of value. $400,000 ÷ $1,000 = 400 units × $1.10 = $440. Total transfer tax = $3,000 + $440 = $3,440. Both taxes are the seller's obligation under the Michigan Real Estate Transfer Tax Act (MCL 207.501) and the County Real Estate Transfer Tax Act.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A transfer tax is a tax imposed on the transfer of ownership of real estate.
Reconciliation is the final step in the appraisal process where the appraiser analyzes the value indications from all applicable approaches and arrives at a single final opinion of value. It is not a simple average of the three values.
The comparable sales approach estimates a property's value by comparing it to similar properties that have recently sold in the same market area. It is the most widely used and reliable approach for appraising residential properties.
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