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        <title>Chicago Suburb Real Estate &amp; Area Guide</title>
        <link>http://www.cook-county-real-estate.net/blog/transfer-taxes/</link>
        <description>New real estate listings, entertainment, recreation, news and things to do in Chicago and surrounding suburbs.</description>
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            <guid>http://www.cook-county-real-estate.net/blog/chicago-real-estate-transfer-tax.html</guid>
            <link>http://www.cook-county-real-estate.net/blog/chicago-real-estate-transfer-tax.html</link>
            <author>judyorr@gmail.com (Judy Orr)</author>
            <title>Chicago Real Estate Transfer Tax</title>
            <description> <![CDATA[ 



My prior post about earnest money was in response to the many "hits" I've received on my website in response to search queries being made.  Another popular search question lately has been about real estate transfer taxes.   


The state of Illinois has a transfer tax usually paid by sellers of $.50 per every $500.00 of the sales price.  The Cook County transfer tax is $.25 per every $500.00 and is paid by the seller.  Will County is the same as Cook County and although either party can pay it is usualy charged to the seller.  For a list of transfer taxes in all counties click here. These fees are taken care of out of the seller's proceeds at closing.


Some towns also have their own transfer taxes.  Some are paid by the buyer, some by the seller and some are paid by both.  The Chicago real estate transfer tax is $3.75 per every $500.00 and is paid by the buyer.  I had a telephone conversation today with a buyer regarding this tax.  He felt it was an exorbitant amount and wanted to know if the property sales price could be adjusted to offset this tax charged to the buyer.  I answered that everything is negotiable, but this is a customary buyer fee and not all sellers will want to negotiate this normal buyer cost.


In fact, the buyer kept wondering if something could be done through the mortgage company and it took a bit of explaining to make him realize that this fee has nothing to do with the mortgage.  This is not the same as "points" and is not a fee required by any kind of bank, savings and loan or mortgage broker.


He also asked me a question I wasn't 100% sure of regarding if it was an income tax deduction.  As I don't want to mince words I am quoting this directly from the IRS: "Transfer taxes (or stamp taxes).   You cannot deduct transfer taxes and similar taxes and charges on the sale of a personal home. If you are the buyer and you pay them, include them in the cost basis of the property. If you are the seller and you pay them, they are expenses of the sale and reduce the amount realized on the sale." 


 Transfer taxes are part of buying and selling real estate.  As I mentioned, you can try to negotiate anything if you're a buyer that has to pay this fee.  But that doesn't mean the seller is going to agree.  Here's an example I gave based on the price range we were discussing.  There is a Chicago property for sale for $415,000.  The buyer and seller agree to a price of $400,000.  Everyone is sure the property will appraise at $400,000.  However, the buyer finds out about the Chicago transfer tax that will cost an additional $3,000.00 to close.  The buyer goes back to the seller and tries to convince the seller to absorb some of this cost by reducing price, say, by $1,500, thereby paying half of the transfer taxes.  Most sellers will say, "My property is worth $400,000.00.  This is your expense so why do I need to pay it?  I have my own expenses as a seller."


In the above scenario I believe it was a sale between acquaintances without a real estate brokerage so the seller did not have a commission to pay and would hopefully work something out with the buyer.  But in a case where the buyer and seller don't know each other personally, the seller might not want to absorb this cost because, as mentioned, it is a typical buyer transfer tax for Chicago.
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            <pubDate>Tue, 13 Mar 2007 20:13:10 -0500</pubDate>
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            <guid>http://www.cook-county-real-estate.net/blog/illinois-transfer-tax-increase-proposal.html</guid>
            <link>http://www.cook-county-real-estate.net/blog/illinois-transfer-tax-increase-proposal.html</link>
            <author>judyorr@gmail.com (Judy Orr)</author>
            <title>Illinois Transfer Tax Increase Proposal</title>
            <description> <![CDATA[ 
The vote to increase real estate transfer taxes in Illinois will be held on Wednesday, March 7th, 2007.  It is bill SB 445 and proposes almost a $99,000,000 increase with some of the extra money going towards affordable housing, open space and natural areas.


At first sight, many homeowners might not feel the impact of this proposed bill.  The reason is that because the increase changes depending on the sales price of the property as shown below:




Properties sold $500,000 or under would actually decrease from $1.00 per thousand to $.80 per thousand.  For those many property owners falling into this group, they would probably welcome the break.  Not much of a break at a savings of $100 for a $500,000 property.


A property sold at a price over $500,000 to $1,000,000 would be taxed at $3.00 per thousand vs. the current $1.00 per thousand.  Now we're talking a bigger difference.


A property sold for over one million dollars and up to three million would be taxed at $7.00 per thousand.


Any property sold over three million would have to pay $10.00 per thousand.  That's a huge difference from the current dollar per thousand.




Your first thoughts might be to let the higher priced properties pay more, but they already are just by the value of the properties to begin with.  Many times the "little guys" seem to get less tax breaks and benefits and they might think that it's time the people with deeper pockets get hit.  We're not always talking about single family residential sales though.  This could affect farms or other business and commercial sales.  


I suppose it's easy to say that anyone selling a property in the millions in Illinois should have to bear this increase, especially if it affords a decrease to the lower priced properties.   The Illinois Association of REALTORS® opposes this bill and has sent out calls of action to all association members.  The IAR asks you to contact your Senator to urge a NO VOTE 			on SB 445.
 ]]> </description>
            <pubDate>Mon, 05 Mar 2007 15:48:01 -0600</pubDate>
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