Determined by Local Custom and Negotiation
Responsibility for paying transfer taxes varies by region and jurisdiction, and is often dictated by local custom, though it can be negotiated in the purchase agreement. In most U.S. counties:

• The seller typically pays the transfer tax
  
• In some areas (e.g., parts of the Northeast or Midwest), the buyer may pay or share the cost
  
• The parties can negotiate alternate arrangements and reflect them in the sales contract
  

Specified in the Purchase and Sale Agreement
The purchase agreement outlines who is responsible for transfer tax payment at closing. If not specified, default local rules or customs apply. Title companies and escrow agents use the contract terms to allocate costs on the closing statement.

• Language such as “Seller to pay all transfer taxes” is common
  
• If silent, local custom governs responsibility by default
  
• Buyers should review the contract to avoid unexpected costs
  

Collected and Paid at Closing Through Escrow
Transfer taxes are calculated based on the final sale price and are collected by the escrow or title company at closing. These funds are then submitted to the local or state taxing authority.

• Shown on the closing disclosure or settlement statement (e.g., HUD-1)
  
• Includes documentary transfer tax, deed recording fees, and any local surcharges
  
• Paid via proceeds from the buyer or deducted from the seller’s sale amount