David sells his condominium in Ann Arbor, Michigan for $480,000. Assuming no exemptions apply, what is the total amount David will owe in Michigan real estate transfer taxes (state plus county combined) at closing?
Correct Answer
C) $4,128
Step 1 — State transfer tax: $7.50 × (480,000 ÷ 1,000) = $7.50 × 480 = $3,600. Step 2 — County transfer tax: $1.10 × (480,000 ÷ 1,000) = $1.10 × 480 = $528. Step 3 — Total: $3,600 + $528 = $4,128. Under MCL 207.505 and MCL 207.523, both the state ($7.50/$1,000) and county ($1.10/$1,000) transfer taxes are paid by the seller.
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Related Topics & Key Terms
Key Terms:
Related Concepts
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.
The cost approach estimates a property's value by calculating the current cost to rebuild the improvements, subtracting accumulated depreciation, and adding the land value. It is most reliable for new construction and special-purpose properties.
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