How much is the real estate transfer tax in Alabama?

Alabama charges a state deed transfer tax of $0.50 per $500 of the sale price, which works out to $1.00 per $1,000, or 0.1% of the price. On a $300,000 home that is $300 in deed tax. The tax is computed per $500 increment, rounding any fraction of an increment up to a full $500. Alabama has no additional county or municipal transfer tax.

What is the Alabama mortgage recording tax?

Separately from the deed tax, Alabama imposes a mortgage recording (privilege) tax of $0.15 per $100 of the amount of debt secured, which equals $1.50 per $1,000 of the loan. On a $240,000 mortgage that is $360. This tax applies only when a mortgage is recorded and is based on the loan amount, not the sale price.

Who pays the transfer tax in Alabama, the buyer or seller?

By custom in Alabama, the seller usually pays the deed transfer tax and the buyer usually pays the mortgage recording tax. However, this is a matter of negotiation and local practice, and the purchase agreement can assign the costs differently. Always confirm who pays what with your closing agent or attorney.

How is the Alabama deed tax rounded?

The deed tax is computed on each $500 increment of consideration, and any fraction of a $500 increment is rounded up to a full increment. For example, a $300,100 sale price has 601 increments (300,100 / 500 = 600.2, rounded up to 601), so the deed tax is 601 x $0.50 = $300.50. This calculator applies that rounding automatically.

Are there exemptions from the Alabama deed tax?

Certain transfers are exempt or excluded under Alabama law, including some transfers to or from government entities, gifts with no consideration, and certain corporate reorganizations. Transfers between spouses or for nominal consideration may have little or no taxable basis. This calculator assumes a standard arm's-length sale; consult your closing attorney for exemptions that may apply to your specific transaction.

Alabama Real Estate Transfer Tax Calculator (Deed Tax)

When you buy or sell property in Alabama, two state recording taxes typically apply: the deed transfer tax of $0.50 per $500 of the sale price (effectively 0.1%), and, if a loan is involved, a mortgage recording tax of $0.15 per $100 of the debt secured (0.15%). This calculator applies both at their statutory rates — including Alabama’s per-increment rounding rule — and shows which party customarily pays each. Unlike many states, Alabama imposes no additional county or city transfer tax.

How it works

The deed tax is charged on each $500 increment of the consideration, rounding any partial increment up to a full one:

Increments = round up (Sale price ÷ $500) Deed tax = Increments × $0.50

The mortgage recording tax is charged on each $100 increment of the loan amount:

Increments = round up (Loan ÷ $100) Mortgage tax = Increments × $0.15

Both taxes are statutory and apply statewide. The deed tax is computed on the sale price; the mortgage tax is computed on the loan amount, so a cash purchase incurs only the deed tax.

Alabama transfer tax rules explained

The deed tax (Ala. Code 40-22-1) is $0.50 per $500, equal to $1.00 per $1,000, or 0.1% of the price.
The mortgage recording tax (Ala. Code 40-22-2) is $0.15 per $100, equal to $1.50 per $1,000 of the debt secured.
By custom the seller pays the deed tax and the buyer pays the mortgage tax, though this is negotiable.
Alabama has no county-level transfer tax — the state rate is the same everywhere.

Worked example

A buyer purchases a home for $300,000 with a $240,000 mortgage:

Deed increments = round up (300,000 ÷ 500) = 600 → deed tax = 600 × $0.50 = $300.00
Mortgage increments = round up (240,000 ÷ 100) = 2,400 → mortgage tax = 2,400 × $0.15 = $360.00
Total recording taxes = $660.00

Typically the seller would cover the $300 deed tax and the buyer the $360 mortgage tax, but the contract controls.

Note: Some transfers are exempt or have a reduced taxable basis (gifts, transfers between spouses, certain government and corporate transfers). This calculator assumes a standard arm’s-length sale. Verify the current rates and any exemptions at revenue.alabama.gov and with your closing attorney.

Alabama Real Estate Transfer Tax Calculator (Deed Tax)

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How it works

Alabama transfer tax rules explained

Worked example