Deed Has Wrong Sale Price
So I just bought my first place a few weeks ago and when I went on ACRIS to check that the deed had been filed I found out the sale price listed is 5K more then I actually paid. All my other documents are correct. My questions are whose fault is this? My lawyer or…
So I just bought my first place a few weeks ago and when I went on ACRIS to check that the deed had been filed I found out the sale price listed is 5K more then I actually paid. All my other documents are correct. My questions are whose fault is this? My lawyer or title company? How do I fix it and do I want/need to? I paid $50 more in transfer fees then I should of but what are the implications in the long run? Thanks!
It’s not a benefit as the actual basis is in fact less than recorded, which means it would be tax fraud to knowlingly use the recorded amount.
The poster is going to have to explain to the IRS at the end of the day how the basis was calculated — but you are right that if the other closing documents are clear on the actual purchase price, then one would hope that should be enough.
I also agree that it’s probably not worth it to try to clear up the error for $50, but check with your lawyer first.
and if it shows $5000 more than he paid when he sells, it would decrease his profit and lower the amount to be taxed…a benefit not a handicap.
no it cost him $50 more for recording tax(1%)…. the fact that it says it was $5000 more including everything is relatively little moment. The IRS will accept other documents….
do you have any idea what this will be like to correct? The deed probably just says “for ten dollars and other compensation”
smeyer, op says $5000 (5k) not $50
deeds normally only recite a ten dollar consideration so its normally not in the deed. So the purchase amount is normally only in the transfer tax form filed with the purchase. the responsibility is normally with the lawyer who prepares these- even if its the title company who filled it out. Also for tax purposes all the amount paid is part of the consideration and sometimes this is more than the purchase amount. Talk with your lawyer. Even if there is a discrepancy between the city/state real estate tax return the closing documents(which you should keep forever btw) will be enough for the IRS.
You don’t want to try to fix a $50 error. It will cost you much more in time and tsauris to correct it. get the $50 from your lawyer or if you were happy with how the lawyer handled it consider it a tip and move on!
Talk to your lawyer first.
I can think of two implications (beside overpaying the transfer tax). First, the actual basis of the purchase does not conform with the contractual amount. This may end up causing some problems with the IRS down the road (if the property is ever sold and the profit frmo the sale eitehr does not qualify for the homeowner excemption or exceeds the exemption amount). Second, doesn’t this mean that you actually owe the seller $5,000 more?