Hi Coralee:

6% sales tax does not apply, there is a transfer tax which varies by city or municipality. not all areas are 2% transfer tax. Also, you would be paying for title insurance, any attorney's fees you may have. Also, if you wanted to purchase homeowners insurance. You would need to reimburse the sellers for any prepaid taxes pro-rata from date of closing. Hope this helps.

6% is a sales tax only for goods and services, not homes. There is, however, a 2% transfer tax for homes. Generally, this is paid 50/50 between the seller and buyer. There are a few exceptions.

Coralee:

Yes, it's Transfer Tax, not retail tax that applies to real estate (except as regards actual "mobile" homes such as trailers, campers, etc.) - but make sure that you and (hopefully your real estate agent) are also aware that the Transfer Tax can differ from place to place in Pennsylvania - for instance, it is 2% mostly, but in the City of Reading, it is currently at 5%. The Transfer Tax is almost always shared between buyer and seller, except in certain cases where the listing will clearly state that the Transfer Tax is the total responsibility of the buyer (listings such as foreclosures, for example).

Again, can't stress enough that you make sure you have a competent real estate agent on your side - almost always, the Buyer's agent fees are paid by the seller, so you won't be paying anything out of your own pocket to get a professional working exclusively for your benefit - otherwise, you really could end up in the middle of a very bad transaction!!

Are you going it alone on this sale? The professionals that are usually involved will know how to calculate all your fees and taxes.

If this home that you are buying is not a trailer, camper, or mobile home, then the retail sales tax does not apply. A transfer tax will be due as Michael has said. There will also be a portion of the yearly real estate tax owed to the seller who has already paid property taxes in advance. Again the professionals, in this case the title company/settlement agent, will know how to determine the amount due.
Please do be sure that you have some help on this. There are many pitfalls that you will avoid if you work with someone who know the practices and customs of the area.
Just curious; how do you come to be in a situation where you need to be asking this question on your own?

Eileen's green Team at Gateway

Coralee,
When buying a home, there is no sales tax. There is a 2% tax to the buyer and seller (except Philadelphia which has an additional 2%) and this is split between buyer and seller. So basically you would only have to pay 1% at closing if you buy cash.
There are however other closing costs involved like title insurance (strongly recommended),notory fees, etc.
The very best of luck to you!
Michael

Michael D Delp
Mortgage Pro
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