6 Pennsylvania Realty Transfer Tax Rules That Add Thousands to a Home Sale

Selling a home in Pennsylvania?

The price on your contract is only part of the story at closing.

A tax tied to the sale may take a bigger bite than you planned for.

Here’s how that bill can grow, in plain terms.

Note: This is general information, not tax or legal advice. Tax rates and rules are subject to change, so confirm the current details with the Pennsylvania Department of Revenue.

1. Local 1 Percent Tax

The state’s realty transfer tax is 1 percent of a home’s value, and a local realty transfer tax of 1 percent is due on top of it.

If you sell a $300,000 home, the state’s share is $3,000.

The local share adds another $3,000 to your sale.

That’s $6,000 in all.

The Department of Revenue says the local rate is higher in some localities, which makes the same sale cost more there.

2. Five Percent in Pittsburgh

If you’re selling a $300,000 home in the Pittsburgh School District, the realty transfer tax on the sale is $15,000.

Allegheny County’s table lists a 3 percent city tax and a 1 percent school district tax, plus the state’s 1 percent.

That totals 5 percent.

Compared with a 2 percent total, that’s $9,000 more on the same sale.

If your Pittsburgh address sits in the Baldwin-Whitehall School District, the total is 4.5 percent, or $13,500 on that sale.

3. Philadelphia’s 4.578 Percent

Since July 1, 2025, Philadelphia’s realty transfer tax has totaled 4.578 percent.

The first adjustment since 2018 came that day, when the city’s share moved from 3.278 percent to 3.578 percent.

The state’s share didn’t change.

Philadelphia says the increase will fund affordable housing programs, including its $2 billion Housing Opportunities Made Easy plan.

If you’re selling a $300,000 home in Philadelphia, the increase alone adds $900 to the tax on your sale.

The full tax on that sale is $13,734, more than double the $6,000 a 2 percent total costs.

4. Mortgages Left in Place

In a sale, the realty transfer tax value is the total agreed price plus any lien that stays on the property after the transfer.

That holds whether or not you formally assume the debt.

If you pay a seller $40,000 for a home that keeps a $260,000 mortgage after the sale, the taxable value is $300,000.

At a 2 percent total, that comes to $6,000 in tax instead of the $800 the $40,000 alone would cost.

Philadelphia’s guidance applies its rate to the sale price plus any assumed debt.

5. Builder Contracts

If you buy a new home from a seller affiliated with the builder, the realty transfer tax can apply to your construction contract.

The Department of Revenue’s new-home guidance says the contract is taxable if it takes effect before or at the same time as the title transfer.

That holds whether or not construction has started when you settle.

If you pay $60,000 for a building lot and sign a $320,000 contract with the seller’s affiliated builder, the contract is taxable.

The state’s 1 percent on that contract alone comes to $3,200, before any local tax.

If the builder has no affiliation with the owner, the tax isn’t due on the contract.

6. Sales From an Estate

A house that passes to you as an heir for no payment escapes the realty transfer tax, but a house you buy from the estate doesn’t.

The Department of Revenue’s October 2024 bulletin says the estate exemption ends if whoever settles the estate transfers the property for any consideration.

That includes paying off the estate’s debts, satisfying a mortgage on the house or assuming the mortgage.

The family exemption doesn’t apply because the Commonwealth Court has held that an estate isn’t the person who died.

Philadelphia’s guidance says the tax is due if any mortgages, liens or debts on the property aren’t paid at closing.

If you’re a sibling buying the family house from the estate for $250,000, the tax comes to about $5,000 at a 2 percent total.

Family Transfers

Some family transfers escape the realty transfer tax.

The Department of Revenue lists certain transfers among family members as exempt.

In Philadelphia, most transfers between spouses, siblings, and direct ancestors and descendants are exempt.

If you’re deeding your house to a sibling or your child, that transfer usually falls in the exempt group.

An heir who buys from an estate is the exception because that purchase is taxable.

Who Owes the Bill

The Department of Revenue says the seller and the buyer are both liable for the realty transfer tax.

Philadelphia’s guidance says the two usually split it evenly, though that isn’t a legal requirement.

The city has the right to collect 100 percent of the tax from either the seller or the buyer.

On a $300,000 sale at 4.578 percent, an even split is $6,867 each.

If you agree to cover all of it as the buyer, your bill is $13,734.

In the Pittsburgh School District, each half of a $300,000 sale at 5 percent is $7,500.

Where the Money Goes

Pennsylvania directs 15 percent of its realty transfer tax collections to the Keystone Recreation, Park and Conservation Fund, according to the Department of Revenue.

In Allegheny County, 1 percent goes to the state and the remainder goes to the municipality and school district for your property.