Documentary Transfer Tax (DTT)

Frequently Asked Questions

What is documentary transfer tax?

A tax imposed on each recorded document in which real property is sold.

How much is the documentary transfer tax?

The tax rate is $.55 for each $500, or fractional part thereof, of the value of real property, less any loans assumed by the buyer.

When is documentary transfer tax paid?

The tax is paid at the time of recording a document transferring real property. Those cities opting into this tax receive half the amount collected for property in the city. The City of Sacramento collects a separate transfer tax above this tax and, thus, does not receive any DTT revenue.

What is city transfer tax?

In lieu of collecting documentary transfer tax (DTT) pursuant to Revenue and Taxation Code section 11911, a City may establish an additional real property transfer tax ("city transfer tax") which it collects separate and apart from the DTT.

In Sacramento County, only the City of Sacramento has established a City Transfer Tax (Sacramento City Code section 3.16.020) and does not receive any DTT revenue. The tax is imposed on all transfers by deeds, or any other document, by which any interests in real property located in the City of Sacramento incorporated area are sold and/or granted, assigned, transferred, or conveyed to purchaser(s), or any other person(s), or entities.

For more information, read the City's notice or contact the Revenue Division (Enforcement & Collections).

When is city transfer tax collected?

City Transfer Tax (in addition to DTT) is collected at the time of recording if the tax amount is identified in the declaration on the first or lead page of the document.

Who pays documentary transfer tax?

Either the buyer or the seller upon mutual agreement.

How do I show the amount of tax due?

Each document in which real property is sold must have a tax declaration on the first page of the document. For assistance, refer to instructions for completing the transfer tax declaration.

When is realty considered to have been sold?

Real property is considered to be sold when a transfer of an interest is for a valuable consideration, which may involve money or anything of value.

What is considered "anything of value"?

Examples of things other than money that have value are: shares of stock in a corporation, interest in a partnership, real property or assuming the debt of another person.

When is realty considered not to have been sold?

The most used example is a bona fide gift. This exclusion is commonly used when adding or removing a co-signor from real property. Gift must be declared as the explanation of no tax due.

Other examples include:

Placing real property in a trust for the benefit of the grantor (revocable trust)
Distribution of partnership property when the partnership is dissolving
And changing how title is held (from joint tenancy to tenants in common)

Are there any exemptions from documentary transfer tax?

Yes. If the property is considered to have been sold there are several exemptions under the law. These exemptions relate to specific causes of real property transfers and are infrequently used. Refer to the fact sheet on Transfer Tax Exemptions under Revenue & Taxation Code for details.

Are there any other requirements?

Yes. Each document transferring an interest in real property must clearly state, on its face, if the property is located in the county's unincorporated area or within a city's limits. Cities in Sacramento County are: Citrus Heights, Elk Grove, Folsom, Galt, Isleton, Rancho Cordova, and Sacramento.

Where can I go to get help in determining the amount of tax due?

Contact a real estate or legal professional. Or, call our office at (916) 874-6334.