At a closing in Newport, Rhode Island, there is a dispute between the buyer and seller over who is responsible for paying the deed excise tax. The buyer's agent argues the buyer should pay because the buyer is receiving the deed. The seller's agent argues it is the seller's obligation. Which statement correctly reflects Rhode Island law and custom?
Correct Answer
D) The deed excise tax is customarily paid by the seller, and by default the seller is responsible under Rhode Island practice
Under Rhode Island's Transfer of Real Property Act (R.I. Gen. Laws § 44-25), the deed excise tax (real estate conveyance tax) is customarily paid by the seller at closing. While parties may negotiate otherwise in a contract, the default responsibility and strong custom in Rhode Island place this tax on the seller. Licensees must understand this Rhode Island-specific custom to properly advise clients.
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