A Chicago building has a city transfer tax of $3.75 per $500 and a state transfer tax of $0.50 per $500. The property sells for $750,000. What is the total transfer tax if the buyer pays the city portion and the seller pays the state portion?

Explanation

Number of $500 increments = $750,000 ÷ $500 = 1,500. City transfer tax (buyer): 1,500 × $3.75 = $5,625. State transfer tax (seller): 1,500 × $0.50 = $750. In Chicago, by custom and ordinance, the buyer pays the city (Chicago) transfer tax and the seller pays the state transfer tax. This is a key distinction—Chicago has one of the highest city transfer tax rates in the country.