Florida Documentary Stamp Tax: What Buyers and Sellers Should Know

When it comes to buying or selling real estate in Florida, one often overlooked—but significant—expense is the Documentary Stamp Tax. Unlike property taxes, which are paid annually, or income taxes, which Florida does not levy at the state level, this is a one-time transaction-based tax that can impact your closing costs considerably.

Whether you're a first-time homebuyer, a seasoned investor, or preparing to sell your property, understanding the details of the Documentary Stamp Tax can help you avoid surprises and make more informed decisions.

What Is the Documentary Stamp Tax?

The Documentary Stamp Tax is a state-imposed excise tax on documents that transfer interest in Florida real property. It applies primarily to deeds and promissory notes, and is most commonly seen during a real estate closing.

Who Pays the Tax?

In most Florida counties, the Documentary Stamp Tax on the deed is traditionally paid by the seller. However, this is a matter of negotiation and can vary depending on the terms of the contract. In some cases—particularly in competitive markets or unique transaction scenarios—the buyer may agree to take on the cost.

How Is the Tax Calculated?

For property sales, the tax is calculated at a rate of $0.70 per $100 of the total purchase price. This equates to 0.70% of the sale amount. The tax is rounded up to the nearest hundred dollars before calculating the total due.

For example:

• On a $300,000 home sale, the tax would be $2,100
• On a $750,000 home sale, the tax would be $5,250
• On a $1,200,000 home sale, the tax would be $8,400

In Miami-Dade County, the tax rate is slightly different:

• The rate is $0.60 per $100 on the transfer of single-family homes
• An additional surtax of $0.45 per $100 applies to other property types, such as multi-family units and commercial buildings

What About Mortgages?

Florida also imposes a separate Documentary Stamp Tax on mortgages (or promissory notes). This is calculated at $0.35 per $100 of the loan amount. Unlike the tax on the deed, this portion is typically paid by the buyer as part of their financing costs.

Using the same example, if you finance $400,000 of a home purchase, your mortgage-related stamp tax would be $1,400.

Why Is This Important?

These taxes can represent thousands of dollars in additional closing costs. For sellers, the stamp tax on the deed reduces net proceeds. For buyers, the stamp tax on the mortgage adds to the cost of borrowing. When not properly planned for, these expenses can derail budgets or create last-minute issues at the closing table.

Can the Tax Be Avoided or Reduced?

In general, the Documentary Stamp Tax is mandatory and applies to nearly all real estate transfers. There are very few exemptions. Some transfers between spouses or as part of certain government transactions may be exempt, but these are narrow in scope and require specific documentation.

Practical Advice for Buyers and Sellers

For sellers, it is critical to factor this tax into your net proceeds calculation when evaluating offers. While the buyer’s purchase price may look attractive, your bottom-line number depends on deducting all costs, including this tax.

For buyers, understanding the total cost of acquisition—especially when financing—is essential. Working with a professional who clearly explains all line-item costs, including the documentary stamp tax, will help you avoid financial surprises.

For real estate professionals, ensuring that your clients are fully informed about these costs enhances your credibility and reduces potential friction in the transaction.

Conclusion

The Florida Documentary Stamp Tax is not a minor fee—it is a substantial closing cost that directly affects the financial structure of every real estate deal in the state. Whether you're selling a beachfront property in Pinellas County, buying a bungalow in Tampa, or investing in commercial property in Miami, the stamp tax must be accurately accounted for.

By understanding how it works and planning accordingly, both buyers and sellers can move through the transaction process with confidence and clarity.

As a trusted advisor, my role is to ensure you are fully informed every step of the way. If you have questions about how the Documentary Stamp Tax might impact your transaction, I’m here to help you navigate it with professionalism and expertise. Click Here to Contact Me.

Middleton Tampa Bay is a top-performing real estate team proudly affiliated with Compass, serving discerning buyers and sellers throughout Tampa Bay, including Pinellas, Hillsborough, Pasco, Manatee, and Sarasota counties. With a reputation for excellence, a deep understanding of the Florida market, and a commitment to elevated service, we guide our clients through every detail with confidence and clarity.