Heard that Oregon has no real estate transfer tax and wondered what that means for your sale in Merlin? You are not alone. While that headline is true in most cases, it does not mean you walk away without closing costs. In this guide, you will learn what “no transfer tax” really covers, the local exception to watch for, and the typical costs Merlin sellers actually pay. Let’s dive in.
Oregon’s transfer tax rule, in plain English
Oregon law blocks cities and counties from charging a tax based on the price of a property sale. That is why you often hear there is no transfer tax in Oregon. You can read the rule in ORS 306.815.
There is one notable Oregon exception. Washington County has a transfer tax of $1 per $1,000 of the sale price that predates the current law. It applies only to property in Washington County, not Josephine County. See the county’s guidance on Washington County’s transfer tax.
What Merlin sellers actually pay
Selling in Merlin means no county transfer tax, but you still have standard closing costs. Here is what to plan for.
Commissions
Commissions are negotiable. Oregon combined commissions have commonly ranged around 4.5 to 5.5 percent depending on market and service level. Review current local quotes, and see state context from Bankrate’s Oregon commission overview.
Title, escrow, and recording
It is customary in Oregon for the seller to pay the owner’s title insurance policy. Escrow fees are usually split or negotiated. Your title company will also handle county recording, reconveyance, and release documents. For line‑item examples, see Western Title’s escrow and closing cost categories, and check Josephine County recording details via the recorder information for Josephine County.
Property tax prorations
You will pay your share of the current year’s property taxes up to the closing date. Title and escrow calculate this on your settlement statement. For a quick overview of typical Oregon seller charges, review this closing cost guide.
Seller concessions and repairs
You may agree to pay part of the buyer’s closing costs, cover repairs, or provide a home warranty. These items are negotiable and can change your net proceeds. Statewide averages show concessions can be a meaningful part of costs, as outlined in RealEstateWitch’s Oregon breakdown.
Liens, HOA, and payoff items
Any mortgage, tax liens, utility liens, or HOA dues and assessments must be paid off or addressed at closing. Title will obtain payoff statements and handle releases. For a sense of the categories that appear on closing statements, see Western Title’s estimate examples.
Income taxes on your gain
Transfer taxes and income taxes are different. If you have a taxable gain, you may owe federal and Oregon income tax. Many sellers of a primary home qualify for the IRS Section 121 exclusion of up to $250,000 for single filers or $500,000 for married filing jointly. Review the basics in IRS Topic 701. Oregon includes capital gains in state taxable income; see Oregon administrative guidance via the Oregon Administrative Rules portal and consult a tax professional for your situation.
A simple Merlin example: $400,000 sale
Use this as a ballpark only. Your title company will prepare exact figures.
- Commissions at ~5 percent: $20,000
- Typical seller closing costs at ~2 percent: $8,000
- Repairs or credits: $0 to $10,000+ depending on negotiations
- Mortgage and lien payoffs: property specific
Your net is the sale price minus these items, plus property tax prorations and any income taxes that apply. Ask for a written net sheet before you list.
How no transfer tax helps, and what it doesn’t do
The absence of a broad transfer tax means one less percentage‑based fee at closing. That can lower your predictable costs compared with states that charge an excise tax on sales. You can confirm the law in ORS 306.815.
Still, “no transfer tax” does not equal “no closing costs.” Commissions, title and escrow fees, prorated taxes, lien payoffs, and concessions usually represent the bulk of a seller’s expenses. Plan for these, and you will avoid surprises.
Josephine County items to double‑check
Josephine County’s Clerk and Recorder handle deed recording, e‑recording, and related fees. Confirm current recording charges and formatting requirements early through your title company or by reviewing Josephine County recorder information. If your property is within a fire district, irrigation district, or has municipal utility accounts, title will check for any special assessments or liens and include them in your payoff.
Quick checklist for Merlin sellers
- Ask for a written net‑proceeds estimate that shows price range, commissions, title and escrow, recording, prorated taxes, liens and payoffs, and any expected concessions.
- Confirm Josephine County recording fees and deed requirements with your title company.
- Gather mortgage payoff info and HOA or special assessment statements.
- Decide which repairs or credits you are willing to offer.
- If you expect a gain, talk with a tax professional and review IRS Topic 701 to see whether the Section 121 exclusion may apply.
Ready to sell in Merlin?
If you want a clear, customized net sheet and a plan that fits the Merlin market, we are here to help. Reach out to Whole Heart Realty for a local estimate and a smooth, well‑explained path to closing.
FAQs
Do Merlin sellers pay a transfer tax in Oregon?
- No. Oregon prohibits most local transfer taxes under ORS 306.815, and Josephine County does not charge one.
Does Washington County’s transfer tax affect a Josephine County sale?
- No. The Washington County transfer tax applies only to property located in Washington County.
Who usually pays for owner’s title insurance in Oregon home sales?
- It is customary for the seller to pay the owner’s title policy in Oregon, while escrow fees are split or negotiated; see examples from Western Title.
How are property taxes handled at closing for Merlin sellers?
- Taxes are prorated to the closing date, with the buyer assuming taxes after closing; see an overview in this Oregon closing cost guide.
What is a reasonable estimate for total seller costs without the mortgage payoff?
- A common planning range is about 6.5 to 8.5 percent of the sale price, combining commissions and typical seller closing costs, though concessions and repairs can raise or lower your total; see Oregon averages from Bankrate and RealEstateWitch.
