Thomas owns 120 acres of agricultural land in Strafford County, New Hampshire enrolled in the Current Use Taxation Program. He sells the land to a developer for $900,000. The full market value of the land at the time of sale is $900,000, and the current use assessed value was $180,000. Which statement correctly describes the total tax obligations triggered by this transaction?
Correct Answer
C) Both the standard NH transfer tax on the $900,000 purchase price and a land use change tax of 10% of market value are triggered
When land enrolled in NH's Current Use Taxation Program is sold for development, two separate tax obligations are triggered. First, the standard NH Real Estate Transfer Tax under RSA Chapter 78-B applies to the full $900,000 purchase price at $1.50 per $100 ($13,500 total, split equally between buyer and seller). Second, removing the land from Current Use triggers a land use change tax under RSA Chapter 79-A equal to 10% of the full market value ($900,000 × 10% = $90,000). These are distinct obligations and both apply.
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Related Topics & Key Terms
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Related Concepts
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.
A conventional loan is a mortgage that is not insured or guaranteed by a government agency such as the FHA, VA, or USDA. It is originated and funded by private lenders and may be conforming or non-conforming.
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