What is the name of the one-time tax levied on recording a property transaction?

What is the name of the one-time tax levied on recording a property transaction?

• A. Intangible sales tax
• B. Documentary stamp tax
• C. Ad valorem tax
• D. Franchise tax

Answer: (B)

Documentary stamp tax is the name of the one-time levy applied when recording a property transfer. It is assessed on the deed or other conveyance documents and paid at the time the document is recorded in the public records. This distinguishes it from ad valorem tax, which is an ongoing annual tax based on property value; from franchise tax, which is charged for the privilege of doing business; and from intangible tax, which applies to intangible assets like stocks. Because it occurs only once at recording, the documentary stamp tax is the correct term.

Documentary stamp tax is the name of the one-time levy applied when recording a property transfer. It is assessed on the deed or other conveyance documents and paid at the time the document is recorded in the public records. This distinguishes it from ad valorem tax, which is an ongoing annual tax based on property value; from franchise tax, which is charged for the privilege of doing business; and from intangible tax, which applies to intangible assets like stocks. Because it occurs only once at recording, the documentary stamp tax is the correct term.