Staring at homes in Sewickley and Pittsburgh and wondering why the closing numbers look so different? Transfer tax is the quiet line item that can swing your cash to close by thousands. If you want a clean, no-drama closing, understanding how this tax works in each location is step one. In this guide, you’ll see the rates, who pays, and simple buyer math you can use before you write an offer. Let’s dive in.
Transfer tax basics in Pennsylvania
Pennsylvania charges a 1% state realty transfer tax on most property transfers. Local governments and school districts can add their own percentages on top of the state rate. The total is collected when the deed is recorded. Title and settlement companies handle this at closing and remit payment to the county recorder. The PA Department of Revenue and Allegheny County outline how this works.
Legally, both buyer and seller are jointly and severally liable for the tax. In practice, your purchase agreement should spell out who pays what. Many deals split the tax, but it is negotiable.
Sewickley vs. Pittsburgh rates
Here are the current combined transfer tax totals for typical residential sales:
Sewickley Borough (Quaker Valley School District): 2.00% total
- 1.00% state + 0.50% municipal + 0.50% school district. Sewickley’s local rate is set by borough ordinance and listed on the county’s local rate table. See the Sewickley ordinance and the county’s Local Tax Rates.
City of Pittsburgh: 5.00% total
- 1.00% state + 3.00% city + 1.00% Pittsburgh School District. These increases were adopted under home rule, making Pittsburgh one of the highest combined rates in the state. See county guidance and background on the Pittsburgh increases.
Important: Always confirm the exact municipality and school district for the property, since nearby addresses can have different local rates. The county’s Local Tax Rates table is the authoritative reference.
Who pays and when
- Liability: By law, both parties are responsible, but your contract should clearly allocate the tax. See the state’s guidance on liability and exemptions at PA Department of Revenue.
- Timing: Transfer tax is due when the deed is recorded. Title or settlement will collect it at closing and remit it to the county. See Allegheny County’s collection overview.
- Documents: You will see the transfer tax on your Closing Disclosure or HUD-1.
Buyer math: quick formula
Use this to estimate your transfer tax before you write an offer:
- Total transfer tax (dollars) = Sale price × total transfer tax rate
- If the contract splits the tax 50/50, your share = Total transfer tax ÷ 2
Worked examples
Sewickley at 2.00%:
- $300,000 × 0.02 = $6,000 total. If split, buyer pays $3,000.
Pittsburgh at 5.00%:
- $300,000 × 0.05 = $15,000 total. If split, buyer pays $7,500.
Quick comparison
On a $300,000 home: Sewickley total transfer tax = $6,000 (buyer’s half if split = $3,000). Pittsburgh total = $15,000 (buyer’s half if split = $7,500). That is a $4,500 higher buyer cash share in Pittsburgh vs Sewickley when taxes are split.
Seller net: a quick look
Here is one simple illustration. Numbers are examples only. Your payoff, commission, and closing costs will vary.
- Assumptions: $500,000 sale price, $300,000 mortgage payoff, example 5.5% commission, typical seller pays half the transfer tax.
- Sewickley at 2.00%: Total tax = $10,000, seller half = $5,000.
- Estimated net before prorations = $500,000 − $27,500 commission − $300,000 payoff − $5,000 transfer tax − $1,500 other costs = $166,000.
- Pittsburgh at 5.00%: Total tax = $25,000, seller half = $12,500.
- Using the same assumptions, estimated net = $160,000.
Note: Transfer tax may be treated as a selling expense for capital gains basis calculations in some situations. Rules vary. Consult a tax professional.
Practical tips to avoid surprises
- Write it in the contract. Use clear language such as “Transfer tax split equally between buyer and seller” or “Seller to pay 100% of transfer tax.” Clarity prevents last-minute disputes. See liability and collection basics at the PA Department of Revenue.
- Confirm the municipality and school district early. Ask your agent or title company to verify the parcel info and expected tax amount using the county’s Local Tax Rates.
- Get an itemized closing estimate. Your title or settlement company can provide a breakdown that shows transfer taxes, recording fees, and who is paying what. See the state’s overview of payment at recording in this guide.
- Consider negotiation strategies. In higher tax areas, sellers sometimes offer to cover more of the transfer tax, adjust price with a closing credit, or otherwise structure terms to support buyer affordability. Always confirm lender rules for any credits.
Before you submit an offer: ask, “What is the total transfer tax dollar amount we should expect at closing for this property?” Getting that figure upfront keeps your cash-to-close plan on track.
Ready to run the numbers for a specific Sewickley or North Hills home and line up a smooth closing? Reach out to Shelley Wood for a clear estimate and a strategy that fits your goals.
FAQs
Who pays the Pennsylvania transfer tax in a home sale?
- By law, both buyer and seller are jointly and severally liable. Your purchase agreement should state who pays. Many transactions split it, but it is negotiable. See the PA Department of Revenue overview.
Why is Pittsburgh’s transfer tax higher than Sewickley’s?
- Pittsburgh adopted a higher city transfer tax and the Pittsburgh School District also levies 1%. Combined with the state’s 1%, the city total is 5%, compared with Sewickley’s 2%. See background on the Pittsburgh rate increases.
When is transfer tax collected in Allegheny County closings?
- It is collected at closing and remitted at deed recording by the title or settlement company. See Allegheny County’s transfer tax guidance.
How do I confirm the correct transfer tax rate for a specific property?
- Verify the exact municipality and school district, then check the county’s official Local Tax Rates table or ask your title company for a written estimate.
Are any transfers exempt from Pennsylvania transfer tax?
- Certain family transfers, transfers by will, and transfers to government or qualifying nonprofits may be exempt with proper documentation. Review the state’s exemption list and confirm with your title company or a tax professional.
