Excise Tax for State, County

State

North Carolina

Year

2018

Tax Rate from Transfer Charge

The state excise tax rate on instruments is $1.00 for each $500 (or fraction thereof) on the instrument used to convey a real property interest to another person.

The state excise tax is based on the consideration or value of the interest conveyed. The state tax is paid by the transferor.

This state excise tax on instruments applies to timber deeds and contracts for the sale of standing timber to the same extent as if these deeds and contracts conveyed an interest in real property.

Seven counties are each authorized by uncodified state special acts to levy an optional local real estate excise tax on conveyances to a maximum of $1.00 on each $100 (or fraction thereof) on instruments used to convey certain real property interests to others.

For the 7 authorized counties, this excise tax is based on the full consideration or on the value of the interest conveyed, including, for a sale, the value of any lien or encumbrance remaining on the property at the time of sale. The tax is to be paid by the transferor.

The authorized counties are Camden, Chowan, Currituck, Dare, Pasquotank, Perquimans, and Washington. Six of 7, excepting Washington County, have levied the tax at a rate of $1.00 per $100.

Since 2011, other counties no longer have authority to impose a transfer tax.  

Exemptions from Transfer Charge

The state tax does not apply to any of the following transfers of an interest in real property: (1) by operation of law; (2) by lease for a term of years; (3) by or pursuant to the provisions of a will; (4) by intestacy; (5) by gift; (6) if no consideration in property or money is due or paid by the transferee to the transferor; (7) by merger, conversion, or consolidation; and (8) by an instrument securing indebtedness.

In general the tax for the 7 authorized counties does not apply to instruments conveying an interest in real property from the United States, the State, or a political subdivision of the State; securing indebtedness; or recording a transfer in which no consideration was paid or is due the transferor by the transferee. In addition, this tax does not apply to conveyances of an interest in real property by operation of law, by will, by intestacy, by merger, or by consolidation.

Record ID

NC001_XF18

Footnotes

The revenue collected from the state excise tax on conveyances is divided between the county, which receives 50% of the revenues, and the state, which receives 50% of the revenues less any taxes refunded and county's allowance for administrative expenses. A county may keep 2% of the state portion as compensation for collecting and remitting the State's share of the tax. The state's share of the excise tax on conveyances is credited to the State General Fund. The revenue collected by the selected few counties from their local real estate excise taxes on conveyances is dispersed into Capital Reserve Funds pursuant to the special legislative acts.

Sources

N.C. Gen. Stat. § 105-228.28 ~ § 105-228.30 (in effect for 2018);
1989 N.C. Sess. Law no. 393 § 1;
1985 N.C. Sess. Law no. 954 § 1;
1985 N.C. Sess. Law no. 525 § 2;
1985 N.C. Sess. Law no. 881 § 1;
1985 N.C. Sess. Law no. 670 § 1

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