Who Pays Maine’s Real Estate Transfer Tax?

Buying or selling a home in Cumberland and hearing about Maine’s conveyance tax for the first time? You are not alone. The transfer tax shows up at nearly every closing in Maine, and it can feel confusing if you are new to the process or selling from out of state. In this guide, you will learn what the tax is, who typically pays it in Cumberland County, how exemptions work, and what to expect at closing so you can plan with confidence. Let’s dive in.

Maine’s transfer tax, explained

Maine imposes a state conveyance tax, also called the real estate transfer tax, when the deed to a property is transferred and recorded. The tax is calculated on the consideration for the property, usually the sale price stated in the deed. The exact rate and the list of exemptions are set by Maine law and administered by Maine Revenue Services.

Because rates and rules can change, you should verify the current rate and any exemptions with Maine Revenue Services before you finalize numbers for your closing. Your closing agent, title company, or real estate attorney can confirm the correct amount based on your contract and the latest guidance.

It helps to remember that the transfer tax is separate from other costs like recording fees, title insurance, and property taxes. Each of these will appear as distinct items on your closing statement, and each can be allocated to the buyer or seller by agreement.

Who pays in Maine and Cumberland

Who is legally responsible for the transfer tax is addressed in Maine statutes and the forms used when the deed is recorded. In practice, who actually pays at closing is negotiable and is controlled by your purchase and sale agreement and the closing instructions.

In many residential transactions across Cumberland County, buyers and sellers commonly split the transfer tax 50-50. This is a custom, not a rule. You can negotiate a different arrangement, and your contract should spell it out clearly.

Even if the agreement allocates the tax to one party, the registry will require that the tax be paid when the deed is recorded. Your closing agent will collect the tax at closing and remit it with the conveyance tax return to the Cumberland County Registry of Deeds. If there is an exemption, the agent will gather the documentation needed to support it.

Exemptions you might qualify for

Maine law provides specific exemptions from the conveyance tax. Common categories that often appear in state transfer tax statutes include transfers between spouses, certain transfers that are part of a divorce settlement, some transfers by gift or to certain trusts, transfers to or from governmental entities, and transfers that result from court orders such as probate or foreclosure matters.

Exemptions are not automatic. To claim an exemption, your deed, affidavit, or conveyance tax return needs to include specific statutory language or certifications. Your title company or attorney will prepare the correct forms and confirm what is required for your situation.

Since exemptions come from statute and can change, do not assume an exemption applies. Verify with Maine Revenue Services and your closing agent before you finalize your settlement statement.

How payment works at closing

Payment of the transfer tax typically happens at the time of recording. In a standard Cumberland County closing, the closing agent collects the transfer tax at the table, prepares the conveyance tax return, and then submits the deed and paperwork to the Cumberland County Registry of Deeds for recording.

You will see the transfer tax as a separate line item on your Closing Disclosure or settlement statement. If the parties agreed to split the tax, you will see your share on your side of the statement. If one party agreed to pay the entire tax, it will be listed on that party’s side.

The purchase and sale agreement controls the allocation, so make sure the transfer tax split is written into your contract. That way, there are no surprises when you review your closing figures.

Transfer tax vs other costs

It is easy to confuse the transfer tax with other closing costs. They are different and are charged by different entities.

• Transfer tax: A state tax on the transfer of real property. Paid when the deed is recorded. Administered by Maine Revenue Services.
• Recording fees: County charges to record documents such as the deed and mortgage. Collected by the Cumberland County Registry of Deeds.
• Property taxes: Annual municipal taxes on ownership, not on the transfer. Adjusted between buyer and seller at closing based on the closing date.

Your closing agent will list each of these separately on your settlement statement and collect the correct amounts under your agreement.

Out-of-state and foreign sellers

If you are selling Maine property as a nonresident, you may have Maine income tax obligations related to any gain on the sale. Some states require withholding at closing for nonresident sellers. You should confirm Maine’s current rules with Maine Revenue Services and a Maine tax professional before you go under contract so you know what to expect.

If the seller is a foreign person for federal tax purposes, federal FIRPTA withholding rules may apply. This is a federal requirement that is separate from Maine’s conveyance tax. Foreign sellers should consult a tax advisor early to understand both FIRPTA and any Maine requirements.

Your closing agent or attorney can help coordinate the right documentation and make sure any required withholding or filings are handled on time.

Checklist for smooth closings

Use this quick checklist if you are a first-time Maine buyer or an out-of-state seller:

• Ask your agent or title company about the local custom for splitting the transfer tax in Cumberland County and what is typical for your property type.
• Specify the transfer tax allocation in your purchase and sale agreement. If you plan to split it, say so in writing.
• Request a preliminary settlement statement early that shows the transfer tax and who is paying.
• Confirm any exemption with your closing agent and Maine Revenue Services. Provide required affidavits or deed language in advance.
• If you are a nonresident or foreign seller, consult a Maine tax advisor about income tax filing and any withholding. Confirm FIRPTA implications if applicable.
• Check with the Cumberland County Registry of Deeds or your closing agent on the forms needed for recording and who will deliver payment.

Where to verify details

Because tax rules and forms can change, always go to authoritative sources for the latest guidance:

• Maine Revenue Services for current conveyance tax rates, instructions, and exemptions.
• Maine Revised Statutes for the statutory language that governs the tax and exemptions.
• Cumberland County Registry of Deeds for recording procedures, required forms, and fees in Cumberland County.
• A Maine title company or Maine-licensed real estate attorney for practical closing procedures and to verify how the transfer tax will be handled in your transaction.

Final thoughts and local help

The conveyance tax is a normal part of buying or selling a home in Maine, but it should never be a surprise. When you write the allocation into your contract, verify the rate and any exemptions with Maine Revenue Services, and review an early draft of your closing statement, you will have complete clarity on who pays and how much.

If you are buying or selling in Cumberland, you deserve a team that combines clear guidance with strong local advocacy. Connect with The Cady Toussaint Team to navigate your Cumberland closing with confidence and keep your move on track.

FAQs

Who pays Maine’s transfer tax in a typical sale?

• In practice it is negotiable and set in the purchase and sale agreement. Many Cumberland County residential closings customarily split the tax 50-50.

How do I find the current Maine transfer tax rate?

• Check with Maine Revenue Services for the official, up-to-date rate. Your closing agent or title company can confirm the correct amount during your transaction.

Is the transfer tax the same as recording fees or property taxes?

• No. The transfer tax is a state tax on the transfer, recording fees are county charges to record documents, and property taxes are annual municipal taxes on ownership.

Are there exemptions from the conveyance tax?

• Yes, but they are specific and documentation is required. Common categories include transfers between spouses, some trust or gift transfers, certain court-ordered transfers, and transfers involving governmental entities. Verify any exemption with Maine Revenue Services and your closing agent.

How is the transfer tax shown on my closing statement?

• It appears as a separate line item on the Closing Disclosure or settlement statement. If the tax is split, each party’s share appears on their side; otherwise it appears on the party who agreed to pay.

Do nonresident or foreign sellers have extra steps?

• Potentially. Nonresident sellers may have Maine income tax filing obligations, and federal FIRPTA may apply to foreign sellers. Consult Maine Revenue Services and a tax professional early to identify any withholding or filings needed.