What closing costs does a land seller usually pay?
Most of a seller's costs fall into a short list. Which ones apply, and who pays, depends on state law, local custom and your purchase agreement.
- Agent commission: only if you listed with an agent. Negotiable and set in the listing agreement.
- Transfer tax or deed stamps: set by state law, sometimes with a county or city tax on top. See the table below.
- Owner's title insurance: paid by the seller in many areas and by the buyer in others. In Texas, title premium rates are set by order of the Commissioner of Insurance.
- Settlement, escrow or attorney fee: often split, or paid by one side under the contract.
- Prorated property tax: you pay the tax for the part of the year you owned the land.
- Liens and back taxes: paid off at closing from your sale money.
- Recording fees: the cost to record the deed and any lien releases. County fees vary and are often small.
- Survey or document fees: only if the contract puts them on you.
Who normally pays closing costs on a land sale?
The contract decides. State law sets who owes some taxes, and local custom shapes what buyers and sellers expect, but a signed purchase agreement can move almost any cost to either side.
Some states name the payer in law. Pennsylvania, for example, holds the grantor and grantee jointly and severally liable for its 1% state realty transfer tax, and custom splits it. Florida's documentary stamp tax on deeds is 70 cents per $100 of the price, except in Miami-Dade County, and the seller usually pays it.
When you sell to a cash buyer, read the line that says who pays closing costs. Many cash buyers pay them all, which makes the offer simpler to compare.
Does a land buyer pay a realtor's commission?
Usually not the seller's. The seller pays its listing agent under the listing agreement. A buyer who has its own agent signs a written agreement with that agent, and the buyer's agent may be paid by the buyer, or by the seller if the parties agree.
The National Association of REALTORS states that broker fees and commissions are fully negotiable and not set by law. If you sell directly to a land buyer with no agent on either side, nobody owes a commission. If your land is already listed, read your listing agreement first, since you may still owe a commission.
How much will I actually net after selling land?
Start with the price and subtract every cost and payoff. The title company can give you a seller's net sheet before closing, and the settlement statement at closing shows the final numbers.
When the money is wired to you, confirm the wiring instructions by phone at a number you already know. The CFPB says never to follow wiring instructions sent in an email.
- Sale price
- Minus agent commission, if any
- Minus the seller's share of transfer tax
- Minus the seller's share of title and settlement fees
- Minus prorated property tax for the part of the year you owned it
- Minus liens, judgments and back taxes paid at closing
- Equals the amount wired or sent by check to you
- Later: federal and state income tax on any gain
What taxes apply when I sell land?
Income tax is not a closing cost, but it changes what you keep. Federal tax applies to the gain, which is the price minus your basis and selling costs. Land held more than one year is usually taxed at long-term capital gains rates of 0%, 15% or 20%, per IRS Topic 409. Land held one year or less is taxed as ordinary income.
The person responsible for closing, usually the settlement agent, files Form 1099-S to report the sale. IRS instructions list improved or unimproved land as reportable.
If the seller is a foreign person, the buyer generally must withhold 15% of the amount realized under FIRPTA, per the IRS. General information, not legal or tax advice.
How do transfer taxes differ by state?
The table below lists each state's real estate transfer tax and who usually pays it. Some counties and cities add their own tax, so ask the title company for the exact figure. Each state links to our page on the costs of selling land there, such as Texas or Florida.
If your land has back taxes, see our guide on selling land with back taxes. If you inherited the land, see how inherited property is taxed when sold.
How EasyLotBuyer handles this
EasyLotBuyer was founded in 2021. When we buy your land, there are no fees or commissions and we pay closing costs. If the land has back taxes or liens, they are paid at closing from the sale, and the settlement statement shows every line. Closings go through an independent title company or attorney. We make a written cash offer within 24 hours, which you can compare with a listing.
Get a cash offer for your land