What is recordation tax?

The Recordation Tax is an excise tax that was previously imposed by the State for the privilege of recording an instrument in the Land Records. Although imposed by the State, the recordation tax, to the extent collected by each clerk or city fiscal office, goes to such city’s treasury. 

Why is the Recordation Tax now being collected by the Baltimore City Transfer Tax Office?

Historically, the City of Baltimore relied upon the State to collect the City’s portion of the Recordation Tax. For this service, the State charged a fee. The City has decided to eliminate the service fee expense and collect its own taxes. 

What is the rate for Recordation Tax?

$ 5.00 for each $500 (or fraction thereof) of the consideration noted or for an instrument of writing securing a debt or the principal amount of the debt secured.

How do we determine consideration? 

“Consideration Payable” is not limited to cash, but may include anything of economic value given to the grantor. Consideration includes the amount of debt assumed by the grantee. Please refer to TP§ 12-103(a), the Memorandum to Clerks forwarding Letter of Advice of Attorney General dated July 12, 2002, and Dean v. Pinder 538 A2d. 1184, 312 Md. 154 (1988).

How should consideration be recited? 

The evidence of the consideration payable is required to be described in the instrument of writing or in a supporting affidavit under oath accompanying the instrument of writing. Please refer to TP§ 12-104(a). The collector of the recordation tax may investigate any recitation of consideration in an instrument presented for recording. (Please see 62 Opinion of the Attorney General 172 (1977) and letter of Advice of Attorney General dated October 21, 1992) 

Do I need to submit anything other than my documents and their attachments?

Yes, a completed Maryland Intake Sheet is required for all documentation presented for processing of recordation tax. The form and instructions for completing the form are available here on the State of Maryland Court's website.

In addition, when submitting multiple document packets, it is the customer’s responsibility to number each document in the order in which they would like for them to be recorded. The City will not be responsible for documents that are recorded out of order.

Where is the Baltimore City Transfer Tax located?

The Municipal Building
Transfer Tax Unit, Room 1, Suite 1B
200 Holliday Street
Baltimore, Maryland 21202

What are the hours of operation?

Monday – Friday from 8:30 am – 4:30 pm (3:30 pm – 4:30 pm drop-off only)

Generally, what documents need to be reviewed and processed by the Recordation Tax Unit?

This is a list of the documents that require the collection of Recordation Tax:

  • Agreements(including Modification)
  • Assignments (Ground Rent Deeds)*
  • Association Liens (Homeowners)
  • Certificate of Tax Sale
  • Contracts of Sale
  • Deeds *
  • Deeds of Trust (including Modification, Supplemental, Refinance)
  • Finance Statements (not all, must state the taxable amount and proof of not being paid at other agencies)
  • Homestead Deed 
  • Indemnity Deed of Trust (IDOT)
  • Irrevocable Assignment of Proceeds
  • Land Installment Contracts 
  • Leases (including Boat Slip Leases)
  • Memorandums of Lease
  • Mortgages
  • Options (if it does not meet requirements for an exemption)

*All Deeds must be submitted for Transfer Tax processing prior to being processed for Recordation Tax.

What documents do not need to be processed through the Recordation Tax Unit?

The following types of documents should not be submitted to our office prior to submission to the Clerk of the Court:

  • Appointments of Substitute Trustees
  • Assignments of Mortgages or Deeds of Trust
  • Bankruptcy Documents
  • Condominium Declarations, By-Laws, Plats, and Liens
  • Land Installment Contracts
  • Leasehold Mortgages
  • Options
  • Powers of Attorney
  • Releases
  • Subordinations

FYI

If any of the above documents are part of a “Party Pack”, meaning that they are in a group of documents including a deed, deed of trust, etc, they will be reviewed and noted by the Recordation Tax Unit. If they are a “stand-alone” document, they can be forwarded directly to Land Records for Recording.

What happens if a document is exempt from Recordation Tax? Does it still need to be processed by the Recordation Unit and if so are there any special requirements?

Even if a document is eligible for an exemption of Recordation Tax it must still be submitted to the Recordation Tax Unit for review. The reason for exemption must be clearly stated both in the document and in section #3 of the Maryland State Intake Sheet. Please refer to the Recordation Preferred Language Sheet for more detailed information about exemptions?

What is the Recordation Preferred Language Sheet?

PREFERRED LANGUAGE FOR DEEDS AND DEEDS OF TRUST

  • A deed to change tenancy only should include the wording: “This no consideration deed is to change tenancy only as the grantor and grantee are identical.”
  • A deed to remove the name of a deceased owner should include the wording: “This no consideration deed is for the sole purpose of removing the name of a deceased owner from the title.”
  • A deed for transfers between spouses or former spouses should include the wording: “This deed transfers an interest in real property between spouses or former spouses pursuant to MD. CODE ANN., TAX-PROP. § 12-108(d)(i).”
  • A deed for transfers of residential real property between domestic partners or former domestic partners should include the wording: “This deed transfers an interest in residential real property between domestic partners or former domestic partners and is exempt from state recordation tax pursuant to MD. CODE ANN., TAX-PROP. § 12-108(d)(ii).” Note: ‘Affidavit of Domestic Partnership’ is also required.
  • A deed for transfers between relatives for no consideration on the free and clear property should include the wording: “This no consideration deed transfers an interest in real property between relatives (please state relationship). This property is free and clear of all liens, mortgages, encumbrances, and deeds of trust. The grantor is not being relieved of any liability and the grantee is not assuming any liability.”
  • Transfers between relatives when the property is transferred to the transferor’s son, daughter, parent, son-in-law, daughter-in-law, parent-in-law, or grandchild (also the ‘step’ variety of all of the preceding) should include the wording: “This deed transfers an interest in real property between relatives (please state relationship) subject to an existing mortgage or deed of trust for which the unpaid principal balance is being assumed and is exempt from state recordation tax pursuant to MD. CODE ANN., TAX-PROP. § 12-108(c).” There is no other consideration and there is no refinance transaction at or near the time of this transfer.”
  • A deed for transfers into a revocable trust should include the wording: “This no consideration deed transfers an interest in real property to the grantor’s revocable trust in which grantor is a primary beneficiary.”
  • A deed for transfers out of a revocable trust should include the wording: “This no consideration deed transfers an interest in real property under the terms of the revocable trust in which grantee is a primary beneficiary.
  • A deed of trust which qualifies for the refinance exemptions under MD. CODE ANN., TAX-PROP. § 12-108(g) should include the wording: “The grantor is the original mortgagor, the mortgaged property is the principal residence of the original mortgagor, and the amount of the unpaid principal balance of the original mortgage/deed of trust being refinanced is $ ------------.”

Note: Unpaid principal balance does NOT include interest or other costs/fees. Note: ‘Affidavit of Refinancing Exemption’ is also required.

  • A deed of trust refinances by a revocable trust qualifies for the refinance exemption under MD. CODE ANN., TAX-PROP. § 12-108(g) should include the wording: “This mortgage/deed of trust secures the refinancing of real property that is the principal residence of the settler of the trust, is given by the trustee of the trust, that the trustee or settler originally assumed or incurred the debt secured by the existing deed of trust, and the amount of the unpaid principal balance of the existing mortgage/deed of trust being refinanced is $-----------.”

Note: Unpaid principal balance does NOT include interest or other costs/fees. Note: ‘Affidavit of Refinancing Exemption’ is also required

Will there be a change in procedures for submitting documents for Recordation Tax Processing?

This change will require a change to both the routing of documents and to the payees of checks submitted to record your documents.

This change will require two checks:

  • One made payable to the Director of Finance for the City’s Recordation Taxes and
     
  • The second check make payable to Circuit Court for Baltimore City for the State’s Transfer Taxes and any State recording fees.

A separate check made payable to the Director of Finance will be needed if you are paying Transfer tax at the same time. 

How do I submit my documents to the Recordation Tax Unit? Can I mail them in?

Documents that require the collection of Recordation Tax can be submitted to the unit in three different manners:

  • Mail
  • In-Person (Dropped Off)
  • In-Person (Walkthrough)

Please be advised that all documents that are mailed in or dropped off must include a self-addressed, postage-paid envelope (12.5 x 9.5 min).

What is the turnaround time for documents that are mailed in?

Documents submitted in bulk and/or via mail will be reviewed as quickly as possible. We will notify you when they are complete and will strive for a maximum turn-around time of up to 5 business days. To facilitate processing, all drop-offs or mail-ins are required to be accompanied by a completed Maryland Intake Sheet. One sheet should be utilized for each transaction. The sheet should include accurate and complete contact information, including name, address, phone number, fax number, and e-mail address.

What are the procedures for documents that are Dropped-Off?

All documents that are dropped off must be accompanied by a Recordation Tax Drop Off form. The forms are located in the Recordation Tax Unit. Drop-offs are treated as mail and will be processed within 5 business days. Please note that all Deeds that consist of 5 properties or more can not be walked through and must be dropped off. Once the documents have been processed you will be notified. Please indicate on the drop-off form if you would like for the clerk to hold the documents for pick up or forward the documents to Land Records.
Please be advised that all documents that are mailed in or dropped off must include a self-addressed, postage-paid envelope (12.5 x 9.5 min).

What are the procedures for Walk-Through submissions?

Customers have the option of visiting the Recordation Tax Unit and waiting for their documents to be processed (walk-through).

The customer must sign in (Transfer Tax/Recordation Tax designated sign-in sheet is located in the front of the office) and have a seat in the lobby and wait to be called.
The customer can have up to 3 documents processed per turn. If the customer has more than 3 documents to be processed they can sign in again once the first three documents have been completed.

Other policies and procedures for the walk-thru customers:

  • Must be present when called otherwise, they will lose their turn and need to sign back in.
  • Can not leave documents at Clerk’s desk and leave
  • Can not sign in while being waited on. Must wait until documents are fully completed before signing in again
  • Must be at least 16 years of age to be served

Please note that all Deeds that consist of 5 properties or more can not be walked through and must be dropped off.