Of all the costs a Virginia buyer pays, the recordation tax is the one people understand the least and notice the most, because it is large and it is government. Let me explain exactly what it is, how it is calculated, and why there are really two of them.
Written by Anthony I. Shin, Esq., Principal and real estate attorney at Prime Title & Escrow
The recordation tax is not a tax on the property. It is a tax for the privilege of recording your documents in the public land records at the circuit court, which is the act that protects your ownership. Virginia charges it under the Code of Virginia, and for most buyers it shows up twice: once on the deed and once on the deed of trust.
Under the Code of Virginia (Section 58.1-801), the state recordation tax on a deed is $0.25 per $100 of the greater of the sale price or the assessed value. The locality may add up to one third of the state amount, about $0.083 per $100. A deed of trust carries its own recordation tax of $0.25 per $100 of the loan amount under Section 58.1-803. The buyer customarily pays both.
The tax on the deed
When your deed is recorded, the state charges $0.25 for every $100 of value, and the locality can add up to a third more. On a $600,000 purchase, the state portion is $1,500, and where the locality imposes the full add on, the local portion is roughly $500, for a combined deed recordation tax near $2,000. The clerk of the circuit court collects it when the deed is recorded.
One detail matters here. Since July 1, 2024, Virginia law defines the value of the property for recordation as the most recent property tax assessment, and the clerk taxes the greater of the price or that assessment. If your assessment is higher than your price, the tax is figured on the assessment, which surprises some buyers. I check this for your specific property so the figure is right.
The tax on the deed of trust
If you are financing, your lender records a deed of trust, the document that secures the loan against the property. That carries its own recordation tax, generally $0.25 per $100 of the loan amount, with reduced rates on very large loans. On a $480,000 loan, the deed of trust recordation tax runs about $1,200 at the state rate, plus the local add on. A cash buyer has no deed of trust, so this second tax does not apply.
A refinance records a new deed of trust, so the deed of trust recordation tax applies again. Virginia softens this with a reduced rate on the portion of the new loan that was already taxed when you recorded the prior deed of trust. The saving depends on your old and new loan amounts, so I calculate it for your refinance rather than assume. Your purchase guides also tie in here: see cash to close for how these figures reach your bottom line.
Who pays it, and can it move
By long custom the buyer pays the recordation tax on both the deed and the deed of trust. Like most closing costs, that can be negotiated in the contract, and a seller concession can help cover it. What does not change is that the clerk will not record the documents until the tax is paid, which is why my office handles it precisely as part of the recording step.
How it fits the bigger picture
The recordation tax is the buyer’s side of Virginia’s transfer taxes. The seller’s side is the grantor’s tax, which I cover in the Virginia grantor’s tax, plus the regional fees in Northern Virginia. For the full set of buyer costs and how they add up, see my overview of closing costs in Virginia and the line by line split in who pays closing costs in Virginia.
Recordation taxes apply across Virginia, on residential and commercial deals, for purchases and refinances. The rates are set by statute, the local add on varies by locality, and the value is taken on the greater of price or assessment, so the safest number is one I calculate for your exact property and locality.
Send me your contract and your locality and I will calculate the deed and deed of trust taxes for your closing.
Get Your Free Quoteor call (703) 552-4155Frequently asked questions
What is the recordation tax in Virginia?
The recordation tax is a tax for recording a deed or a deed of trust at the circuit court. The state rate on a deed is $0.25 per $100 of the greater of the price or the assessed value, and the locality may add up to one third more. A deed of trust carries its own recordation tax of $0.25 per $100 of the loan.
Who pays the recordation tax in Virginia?
The buyer customarily pays the recordation tax on both the deed and the deed of trust, although the contract can shift it. It is collected by the clerk of the circuit court when the documents are recorded.
How much is the recordation tax on a Virginia home?
At the state rate of $0.25 per $100, a $600,000 deed carries $1,500 in state recordation tax, plus up to about $500 in local tax where the locality imposes the full one third add on. A loan adds a separate deed of trust recordation tax of about $0.25 per $100 of the loan amount.
Is the recordation tax based on the sale price or the assessment?
On the greater of the two. Since July 1, 2024, Virginia defines the value for recordation as the most recent property tax assessment, so the clerk compares the price to the assessment and taxes the higher figure.
Is there a recordation tax on a refinance in Virginia?
A refinance records a new deed of trust, which carries the deed of trust recordation tax, but Virginia provides a reduced rate on the portion of the loan that was already taxed on the prior deed of trust. The exact saving depends on the numbers, so confirm it for your refinance.
This article is general information about the Virginia recordation tax under the Code of Virginia, Sections 58.1-801, 58.1-803, and 58.1-814. It is not legal or financial advice for your specific transaction, and rates and local add ons can change. Please confirm the figures for your property and locality with me directly.