Montgomery County MD Transfer and Recordation Tax: Complete 2026 Guide

Part of: The Complete Guide to Buying a Home in Montgomery County, MD

Transfer and recordation taxes are the biggest closing cost surprise in Maryland. Most buyers expect lender fees and title charges. They don't expect to write a check for $8,000 or more in taxes on top of everything else. On a $650,000 home in Montgomery County, the three taxes add up to $16,570, and at the customary 50/50 split the buyer's half is $8,285. Here's how it works.

To run your own numbers, use the buyer closing-cost calculator, which includes these taxes alongside lender, title and prepaid costs.

For the seller's side of the closing statement (who pays which transfer tax and every other line item), see who pays closing costs when selling a house in Maryland.

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Maryland's Transfer and Recordation Tax Structure

A home sale in Montgomery County triggers three separate taxes. Two are transfer taxes (state and county), and one is the county recordation tax. All three are calculated on the purchase price, and by default Maryland law splits all three equally between buyer and seller (Real Property §14-104).

1. Maryland State Transfer Tax

Rate: 0.5% of the sale price.

First-time buyer rate: If the buyer is a first-time Maryland home buyer (has never owned a principal residence in Maryland) and will live in the home, the rate drops to 0.25% of the full price, with no price cap, and the seller pays all of it (Tax-Property §13-203).

Who pays: Split 50/50 between buyer and seller by default. However, this is negotiable. In a seller's market, buyers often pay their full share; in a buyer's market, sellers may absorb both halves.

Example on $650,000 (standard buyer):

• $650,000 × 0.5% = $3,250 total
• Split: buyer pays $1,625, seller pays $1,625

Example on $650,000 (first-time Maryland buyer):

• $650,000 × 0.25% = $1,625 total
• Seller pays all $1,625; buyer pays $0

2. Montgomery County Transfer Tax

Rate: 1.0% of the sale price.

Who pays: Split 50/50 by default (buyer and seller each pay 0.5%), but negotiable. In a sale to a first-time Maryland home buyer who will occupy the home, the seller pays all of it by default unless the contract expressly says otherwise (§14-104). Ask your title company about any county exemptions you may qualify for.

Example on $650,000:

• $650,000 × 1.0% = $6,500 total
• Split: buyer pays $3,250, seller pays $3,250

3. Montgomery County Recordation Tax

Rate: Charged on the purchase price (not the loan amount) when the deed is recorded. Maryland has no separate state recordation rate; each county sets its own. Montgomery County uses marginal tiers, charged per $500 of price:

Portion of the price	Rate per $500
Up to $500,000	$4.45
$500,000 to $600,000	$6.75
$600,000 to $750,000	$10.20
$750,000 to $1,000,000	$10.78
Above $1,000,000	$11.35

Who pays: Split 50/50 by default. For a first-time Maryland home buyer who will occupy the home, the seller pays all of it by default unless the contract expressly says otherwise (§14-104).

Example on $650,000:

• First $500,000: 1,000 × $4.45 = $4,450
• Next $100,000: 200 × $6.75 = $1,350
• Last $50,000: 100 × $10.20 = $1,020
• Total: $6,820 (buyer $3,410, seller $3,410)

Owner-occupant exemption: County Code §52-16B provides that the first $100,000 of consideration may be exempt from county recordation tax for an owner-occupied principal residence. That's worth about $890 in total. Confirm eligibility with your title company.

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Total Transfer and Recordation Tax: Side-by-Side Examples

The "standard buyer" column is the buyer's half at the default 50/50 split. The "first-time buyer" column is a first-time Maryland home buyer who will occupy the home: by default the seller pays all three taxes, though the contract can shift some of that back to the buyer.

At $450,000 Purchase Price

Tax	Standard Buyer	First-Time Buyer
State transfer tax (buyer's half)	$1,125	$0
County transfer tax (buyer's half)	$2,250	$0
County recordation tax (buyer's half of $4,005)	$2,003	$0
Total buyer costs	~$5,378	$0 by default

At $650,000 Purchase Price

Tax	Standard Buyer	First-Time Buyer
State transfer tax (buyer's half)	$1,625	$0
County transfer tax (buyer's half)	$3,250	$0
County recordation tax (buyer's half of $6,820)	$3,410	$0
Total buyer costs	$8,285	$0 by default

At $850,000 Purchase Price

Tax	Standard Buyer	First-Time Buyer
State transfer tax (buyer's half)	$2,125	$0
County transfer tax (buyer's half)	$4,250	$0
County recordation tax (buyer's half of $11,016)	$5,508	$0
Total buyer costs	$11,883	$0 by default

Note: These assume the default allocation. Actual amounts depend on what the contract says, and any exemptions your title company confirms.

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Who Pays Transfer Taxes: Buyer vs. Seller

Maryland law sets a default (a 50/50 split, or seller-pays for a first-time Maryland buyer), but buyer and seller can agree to allocate the taxes differently in the contract.

In a seller's market (like spring 2026 Montgomery County): Sellers routinely receive offers where buyers agree to pay their own full share (and sometimes the seller's share) to make the offer more attractive. When there are 10+ offers on a home, buyers sometimes absorb the full transfer tax to compete.

In a buyer's market or negotiated transaction: Sellers may offer to pay the full transfer tax as a seller concession, reducing the buyer's out-of-pocket at closing.

For sellers: Your portion of the transfer taxes is a deduction from your proceeds at settlement. On a $650,000 sale, your transfer tax cost (state + county combined) is $4,875 at the standard 50/50 split, plus $3,410 for your half of recordation tax, for $8,285 in total. If your buyer is a first-time Maryland buyer, the default is that you pay all of it: $1,625 state (at the 0.25% rate) + $6,500 county transfer + $6,820 recordation = $14,945.

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Transfer Tax vs. Recordation Tax: What's the Difference?

Transfer tax = a tax on the transfer of ownership. It's calculated on the sale price and applies when title changes hands from seller to buyer.

Recordation tax = a tax on recording an instrument (like the deed) in the county land records. On a purchase it's calculated on the purchase price, using the county's tiered rates above, and it's paid when the deed is recorded at settlement.

Both are often referred to loosely as "transfer taxes" but they're separate calculations with different rates and different exemption rules.

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First-Time Buyer Exemptions: What You Actually Save

If you qualify as a first-time Maryland home buyer (you've never owned a principal residence in Maryland, and you'll live in this one), the default allocation shifts every one of these taxes to the seller:

Tax	Standard buyer's share	First-time buyer's share (default)	Savings on $650K
State transfer tax	Half of 0.5%	$0 (rate drops to 0.25%, seller pays)	$1,625
County transfer tax	Half of 1.0%	$0 (seller pays)	$3,250
County recordation tax	Half of tiered total	$0 (seller pays)	$3,410

Combined, a first-time Maryland buyer on a $650,000 purchase saves $8,285 in taxes compared to a repeat buyer, as long as the contract doesn't shift the taxes back. This is real money that should factor into your offer strategy and program-stacking decisions. Expect a seller in a competitive market to account for it when weighing your offer.

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Frequently Asked Questions

How much are transfer taxes on a $650K home in Montgomery County?

The three taxes total $16,570: $3,250 state transfer, $6,500 county transfer and $6,820 county recordation. A standard buyer at a 50/50 split pays $8,285. A first-time Maryland buyer pays $0 by default, because the seller pays all three unless the contract says otherwise.

Who pays transfer taxes when buying a home in Montgomery County?

Maryland's default is a 50/50 split between buyer and seller, but this is negotiable. In competitive spring markets, buyers often pay their full half. In slower markets, sellers may offer concessions covering part or all of the buyer's share. For a first-time Maryland buyer, the default is that the seller pays everything.

What is the Montgomery County transfer tax rate?

1.0% of the sale price, split 50/50 by default (buyer pays 0.5%, seller pays 0.5%). In a sale to a first-time Maryland buyer who will occupy the home, the seller pays all of it unless the contract says otherwise.

What is the Maryland recordation tax rate?

Maryland doesn't have a single statewide rate; each county sets its own. Montgomery County charges recordation tax on the purchase price in marginal tiers: $4.45 per $500 up to $500,000, $6.75 up to $600,000, $10.20 up to $750,000, $10.78 up to $1,000,000 and $11.35 above that. On a $650,000 home that's $6,820 in total.

Is there a first-time buyer exemption on Maryland transfer taxes?

Yes. For a first-time Maryland home buyer who will occupy the home, the state transfer tax drops to 0.25% of the full price and the seller pays it (Tax-Property §13-203). The seller also pays the full county transfer and recordation taxes by default unless the contract expressly says otherwise (Real Property §14-104). Ask your title company about any county exemptions you may qualify for.

Do I pay transfer taxes when refinancing in Montgomery County?

The state and county transfer taxes do not apply to refinances. Those only apply when ownership transfers. Recordation tax can apply when a new deed of trust is recorded, and how much depends on the loan, so ask your title company for the figure on your refinance.

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Related Resources

• The Real Cost of Buying a Home in Maryland: Closing Costs, Taxes, and Fees
• Montgomery County MD Property Tax Rate (2026): What Homeowners Actually Pay
• First-Time Home Buyer Programs in Maryland (2026)
• How to Look Up Montgomery County Real Estate Records

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Buying in Montgomery County and want to know exactly what you'll owe at closing? I'll run the full cost breakdown for any purchase scenario. Get in touch.

Sources & further reading

The primary sources behind the tax and assessment figures in this post:

• Montgomery County Department of Finance — current county tax rates, billing dates and transfer/recordation figures
• Maryland Real Property Search (SDAT) — ownership, assessed value and deed history for any Maryland parcel
• IRS Topic 701 — Sale of Your Home — the capital-gains exclusion rules in the IRS's own words