What is transfer tax on a house? The tax a county collects when a deed is recorded, charged on the value of the property transferred; in Clark County it is $2.55 per $500 of value.
Real property transfer tax is charged on the act of transferring property, not on owning it and not on the gain from selling it. The county recorder collects it at the moment the deed is presented for recording, computed on the value transferred, and the deed does not record until it is paid or an exemption is claimed on the declaration of value filed with it. Nevada's version is NRS chapter 375.
The rate is the state's $1.95 per $500 of value plus what the county adds. In Clark County the total is $2.55 per $500 of value or fraction of it, roughly $5.10 per $1,000. A $450,000 sale is 900 increments of $500, so the tax is $2,295. Buyer and seller are jointly and severally liable under NRS 375.030, meaning the county can look to either one, but the seller customarily pays it here and it sits on the seller's side of the settlement statement. The recorder publishes the current rate and it is the figure to check against before quoting one.
Not every recorded transfer is taxed. NRS 375.090 exempts a list that includes a transfer between former spouses under a decree of divorce, a transfer to a relative within the first degree, a transfer into or out of a trust without consideration when a certificate of trust is presented, and transfers between joint owners where no value changes hands. The exemption is claimed on the declaration of value at recording with the subsection cited, so the recorder settles it then rather than a filing settling it later. A tax preparer or the recorder's own office confirms which one applies.
A worked example
A Las Vegas home sells for $450,000. The declaration of value states $450,000, the recorder computes 900 increments of $500 at $2.55 each, and $2,295 is collected at recording. A $700,000 sale is 1,400 increments, or $3,570. On the settlement statement it sits with the seller's costs, beside the commission and the prorated property taxes.
Read the county record the deed lands in
Questions people ask
Who pays transfer tax in Nevada?
Buyer and seller are jointly and severally liable under NRS 375.030, so the county can collect from either. Custom in Clark County puts it on the seller, and the purchase contract is where it is actually assigned, so a contract can move it.
Is transfer tax deductible?
Not as a deduction on a personal return. A seller normally treats it as a cost of the sale, which reduces the amount realized, and a buyer who pays it adds it to the basis of the home. A tax preparer applies the rule to a specific return.