New Recordation Tax Rate

January 22, 2008

Montgomery County, Maryland1

(effective March 1, 2008)

County Transfer Tax 1%

State Transfer Tax 0.5%2

State Recordation Tax 0.69%3

Total Transfer and Recordation 2.19%

Effective March 1, 2008, there will be an additional recordation tax on all consideration over $500,000 .31%

On November 21, 2007, Montgomery County Executive Isiah Leggett signed a bill increasing the County Recordation Tax Rate for consideration paid above $500,000.00 only to $10 per $1,000.00 (or 1%) effective March 1, 2008. Therefore, for any settlement conducted after February 29, 2008, this rate increase will apply. The increased rate will ONLY APPLY TO THE AMOUNT OF CONSIDERATION ABOVE $500,000 AND ONLY APPLY TO THE RECORDATION TAX. Consideration up to $500,000 will continue to be taxed at the $6.90 per $1,000 (0.69%) rate. If the purchaser is eligible for the owner occupant exemption, the exemption will be applied to the first $50,000 of consideration. (Total savings of $345, or $172.50 per party if transfer and recordation being split).

By means of example, in a transaction in which the sales price is $600,000 and the Buyer is going to occupy the property as their residence, the tax will be calculated as follows:

Total Sales Price: $600,000

County Transfer on $600,000(1%)$6,000

State Transfer on $600.000(0.5%)$3,000

County Recordation (Owner Occupant)

$500,000 - $50,000 exemption=$450,000 x .69%$3,105

$600,000 - $500,000=$100,000 x 1%$1,000

Total Transfer and RecordationTaxes$13,105

If Split by parties: /2

$6,552.50 per party

The foregoing was prepared by the Law Firm of Darby, Nalls, Smyth & Muldoon, LLC, General Counsel to Counselors Title, LLC. It is not intended as legal advice and specific questions should be directed to one of our attorneys.

Transfer and Recordation Taxes