Quick answer
Georgia charges two separate taxes at closing. The real estate transfer tax is $1.00 for the first $1,000 of the sale price plus 10 cents for each additional $100, which works out to $1 per $1,000. The intangible recording tax is $1.50 per $500 of the loan amount, capped at $25,000. One is charged on the price, the other on the loan.
Nearly every Georgia candidate can recite both rates by exam day. Far fewer can tell you, under time pressure, which number to multiply. That is what the question is really testing, and it is why the wrong answers are built out of the other tax rather than out of bad arithmetic.
Transfer tax: charged on what the buyer paid
Under O.C.G.A. § 48-6-1, the rate is $1.00 for the first $1,000 of consideration or any fractional part of $1,000, then 10 cents for each additional $100 or fractional part of $100.
Written like that it sounds fiddly. Do the arithmetic once and it collapses:
- 10 cents per $100 is the same as $1.00 per $1,000.
- The first $1,000 is charged at $1.00 as well.
- So the whole thing is $1 for every $1,000 of sale price, rounded up to the next full $1,000.
A $340,000 sale is 340 units of $1,000, so the transfer tax is $340. A $340,400 sale rounds up to 341 units, so it is $341. That rounding is where a careless question gets you, and it is the only wrinkle in the calculation.
The seller is liable for it. The Georgia Department of Revenue says so plainly, and the contract can shift who actually writes the cheque without changing who the tax is imposed on. An exam question asking who is liable wants the seller. A question asking who paid it in a described transaction wants whatever the scenario said.
Intangible recording tax: charged on the loan
Under O.C.G.A. § 48-6-61, the intangible recording tax is $1.50 for each $500, or fractional part of $500, of the face amount of the note secured by the instrument. The maximum on any single note is $25,000.
$1.50 per $500 is $3.00 per $1,000. So:
- Take the loan amount, not the price.
- Divide by $1,000 and round up.
- Multiply by $3.
A $272,000 loan is 272 units, so the tax is $816.
It applies to long-term notes, meaning notes secured by real estate that run for more than three years. A short-term note does not attract it, which is a detail worth carrying because a question can describe a two-year seller-financed note and expect you to know the tax is not due.
Exam trap
A question gives you a sale price, a down payment and a loan amount, then asks for the intangible tax. The sale price is in the question so you will use it. Use the loan.
Working one all the way through
A house in Marietta sells for $415,000. The buyer puts 20 percent down and finances the rest on a 30-year note.
Transfer tax. Sale price $415,000. That is 415 units of $1,000. Transfer tax is $415, owed by the seller.
Loan amount. 20 percent of $415,000 is $83,000, so the loan is $332,000.
Intangible tax. $332,000 is 332 units of $1,000. At $3 per unit, the tax is $996. The note runs 30 years, so it is a long-term note and the tax applies.
Two different bases, two different rates, one scenario. That is the standard shape.
Worth knowing
The $25,000 cap on the intangible tax kicks in at a note of just over $8.3 million. You will not see it on a salesperson exam scenario, but you may see it as a true or false style statement about the tax itself.
The rest of the closing figures
Georgia closings also carry recording fees for the deed and the security deed, and the county collects those separately. They are not calculated as a percentage of anything, so the exam rarely asks you to compute them. What it does ask is which party conventionally pays what, and the usual split is that the seller pays transfer tax while the buyer pays the intangible tax and the recording fees, because the buyer is the one borrowing.
Property tax is a third thing entirely, assessed at 40 percent of fair market value, and it is worked through in the Georgia millage guide.
If you want to run these until the setup is automatic rather than remembered, the math drill will keep serving them, and the formula sheet has both rates written out.
Check yourself
1. A home in Athens sells for $268,000. What is the Georgia real estate transfer tax?
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Answer: A. Transfer tax is $1 per $1,000 of sale price. $268,000 divided by $1,000 is 268, so the tax is $268. Choice B applies the intangible rate of $3 per $1,000 to the price, which is the classic mix-up.
2. A buyer finances $310,000 on a 30-year note secured by Georgia real estate. What is the intangible recording tax?
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Answer: C. $1.50 per $500 is $3 per $1,000. $310,000 divided by $1,000 is 310, and 310 multiplied by $3 is $930.
3. Who is liable for the Georgia real estate transfer tax?
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Answer: B. The seller is liable, though the parties often agree in the contract that the buyer will pay it. Liability and who writes the cheque are different questions.
4. A seller finances a buyer on a note running for two years, secured by the property. Which statement is correct?
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Answer: B. The intangible recording tax applies to long-term notes, meaning those running more than three years. Transfer tax still applies because the property still changed hands.
FAQ
Why does Georgia charge two taxes at closing?
They tax different things. The transfer tax is on the transfer of the property itself and has been part of Georgia law for decades. The intangible recording tax is on the recording of a long-term note secured by real estate, so it follows the debt rather than the deed.
Is the transfer tax really just $1 per $1,000?
For calculation purposes, yes, once you round the price up to the next full $1,000. The statute expresses it as $1.00 for the first $1,000 plus 10 cents per additional $100, which produces the same number. Learn the shortcut and keep the statutory wording in reserve for a question that quotes it.
Does the intangible tax apply to a refinance?
A new long-term note secured by Georgia real estate is a new recording, so the tax follows it. Exam questions stay on purchases, so treat the purchase case as the one to know cold.
What happens if the tax is not paid?
Payment of the transfer tax is a prerequisite to recording. The clerk of superior court will not record the deed until it has been paid and the payment certified on the instrument, which is why it is handled at closing rather than afterwards.