Pennsylvania's real estate transfer tax rate is:
Question & Answer
Review the question and all answer choices
1% (split between state and local)
While 1% is the correct state-only rate, answering 1% as the total rate ignores the local municipality's share, making the total transfer tax burden significantly understated; the complete answer must account for both the state and local components.
2% (1% state, 1% local typically)
3%
3% is not the standard Pennsylvania transfer tax rate; while some municipalities like Philadelphia have rates exceeding 2%, 3% is not the typical statewide figure that the exam tests, and selecting this answer reflects confusion about local variations versus the standard rate.
4%
4% dramatically overstates the Pennsylvania transfer tax rate and does not correspond to any standard Pennsylvania jurisdiction's combined rate; this is a clear distractor designed to test whether candidates have actually studied the correct figure.
Why is this correct?
Under Pennsylvania's Realty Transfer Tax statute (72 P.S. §8101-C et seq.), the Commonwealth imposes a 1% transfer tax on the sale price of real property, and local municipalities are authorized to impose an additional transfer tax, typically 1%, for a combined total of 2% in most Pennsylvania jurisdictions. The tax is generally split equally between the buyer and seller by custom, though the parties can negotiate who pays which portion.
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