Question

In the Rodriguez's state, there is a transfer tax of $2 per $500 sale price or fraction thereof when real property is sold. The Rodriguez's listed their home for $200,000 and accepted an offer for $199,000 from Mr. and Mrs. Clark, who obtained a mortgage loan for $160,000. How much did the Clarks have to pay in transfer tax?

Answer 1

$796

Step-by-step explanation:

The sale price to be used in the computation of the transfer tax is the accepted offer price of $199,000 and not the $200,000 listing price.

With a transfer tax of $2 per $500, the tax to be paid for the sale price of $199,000

`= Tax Rate * Sale Value`

=
`(2)/(500)*199,000`

`= $796.`