Costs of Selling Land in Rhode Island
Here is what a land seller usually pays in this state, from transfer tax to capital gains. When you sell to us, we pay the closing costs and you pay no fees or commissions.
- Cash offer in 24 hours
- No fees or commissions
- We pay closing costs
- Close in as few as 7 days
Seller Costs in Rhode Island at a Glance
| Cost | Typical amount | Who usually pays |
|---|---|---|
| Realty conveyance tax | $3.75 per $500 ($7.50 per $1,000) | Seller unless the contract says otherwise |
| Nonresident seller withholding | 6% of the payment for nonresident individuals, estates and trusts | Withheld by the buyer from a nonresident seller as a tax prepayment |
| Recording fees | Set by the county recorder; charged per document or page | Buyer usually records the deed; seller pays to record lien releases |
| Title search and owner's title insurance | Priced by the title company or attorney; varies with sale price | Set by the contract and local custom |
| Prorated property taxes | Your share of the current year's tax, up to the closing date | Seller for the days owned; unpaid back taxes are paid from the sale |
| Federal capital gains tax | 0%, 15% or 20% of a long-term gain (land held over 1 year); short-term gains taxed as ordinary income; 3.8% NIIT may apply at higher incomes | Seller, on the gain only |
| Rhode Island income tax on the gain | 2025 rates: 3.75%, 4.75% and 5.99% | Seller |
Example: Seller Costs on a $25,000 Land Sale
- Realty conveyance tax (50 units of $500 x $3.75)
- $187.50
- Total seller transfer cost
- $187.50
$25,000 / $500 = 50 units. 50 x $3.75 = $187.50. A nonresident seller would also have 6% ($1,500) withheld unless an exemption applies; that is a credit on the Rhode Island return, not a fee. Recording, title and prorated taxes are not included.
Selling Costs in Rhode Island: What to Know
Rhode Island raised its realty conveyance tax on October 1, 2025. The seller pays it unless the contract says otherwise. This page lists that tax and the other costs of selling land in Rhode Island, with an example on a $25,000 lot.
Most of these costs come out of your proceeds at closing, so you see them on the settlement statement, not as bills. The one cost that comes later is income tax on any gain, which you report on your return. This page is general information, not legal or tax advice. Rates change, so confirm them with the office named here or a tax professional before you rely on them.
Rhode Island realty conveyance tax
The tax is $3.75 for each $500 of the price or part of $500, which is $7.50 per $1,000 (R.I. Gen. Laws 44-25-1). The rate was $2.30 per $500 before October 1, 2025 (RI Division of Taxation).
Residential property that sells for more than $800,000 pays a second tier of $3.75 per $500 on the part over $800,000. A typical vacant lot will not reach that tier.
Unless the parties agree otherwise, the law puts the tax on the grantor, which is the seller.
Who pays what in Rhode Island
In Rhode Island the seller pays the conveyance tax unless the contract shifts it. The buyer usually pays to record the deed and for the owner's title policy.
- Seller: the state transfer tax where the law puts it on the seller, any agent commission, payoff of liens and back taxes, and the seller's share of the year's property tax.
- Buyer: recording the new deed, any lender fees, and the costs the contract assigns to the buyer.
- Either side: title insurance, settlement or escrow fees, and survey costs, as the contract says.
Attorney or title company: who closes a land sale in Rhode Island
In Rhode Island, lawyers handle many real estate closings, often working with a title company. The closing agent prepares the deed and the settlement statement, collects the conveyance tax, pays off liens and back taxes, and handles any nonresident withholding.
If heirs own the land or an estate is open, ask the lawyer to confirm who can sign the deed before you sign a contract.
Capital gains tax when you sell land in Rhode Island
Federal tax applies to the gain, not to the sale price. The gain is roughly the sale price minus what you paid for the land, minus selling costs and the cost of lasting improvements. If you held the land for more than one year, the gain is long term. If you held it one year or less, it is short term and is taxed like wages (IRS Topic 409).
Long-term gains get federal rates of 0, 15 or 20 percent, depending on your taxable income. For 2025, a single filer paid 0 percent on long-term gains if taxable income was $48,350 or less. Higher earners may also owe the 3.8 percent net investment income tax when modified adjusted gross income passes $200,000 for single filers or $250,000 for joint filers (IRS Topic 559).
Rhode Island taxes gains as ordinary income. For 2025 the rates are 3.75 percent, 4.75 percent and 5.99 percent (RI Division of Taxation).
If you are not a Rhode Island resident, the buyer must withhold 6 percent of the payment for an individual, estate or trust, and 7 percent for a corporation (R.I. Gen. Laws 44-30-71.3). You get credit for it when you file.
Recording, title and property tax at closing
Recording fees are set by law and charged by the county office that records deeds. The buyer usually pays to record the new deed. If a mortgage or lien is paid off at closing, the release is recorded too, and the seller usually pays for that.
A title search shows who owns the land and what liens or back taxes sit on it. Owner's title insurance protects the buyer against title problems found later. The price comes from the title company or attorney, and the contract says who pays.
Property tax is split by date. You pay for the part of the year you owned the land, and the buyer pays for the rest. Any back taxes are paid from your proceeds before you get the balance.
How selling to a cash buyer changes the costs
A cash sale has no lender, so there are no loan fees, no appraisal and no financing delays. When you sell to EasyLotBuyer, we pay the closing costs, and you pay no fees or commissions. We can close in as few as 7 days, and we send a cash offer within 24 hours.
We also buy land with back taxes, liens, title problems or no road access, and land held by heirs or an estate. Back taxes are paid at closing from the sale. Tax on your gain is still yours to report, so keep your closing statement for your return. Get a cash offer for your Rhode Island land.
Sources
- 1. webserver.rilegislature.gov
- 2. tax.ri.gov
- 3. webserver.rilegislature.gov
- 4. tax.ri.gov
- 5. irs.gov
- 6. irs.gov
Rules and fees change; check with the county before you act on them.
Selling Cost Questions in Rhode Island
How much is the Rhode Island conveyance tax?
$3.75 per $500 of the price, or $7.50 per $1,000, since October 1, 2025. On a $25,000 lot it is $187.50.
Who pays the conveyance tax in Rhode Island?
The seller, unless the buyer and seller agree otherwise in the contract.
What closing costs does a seller pay in Rhode Island?
Usually the realty conveyance tax of $3.75 per $500, plus payoff of any liens or back taxes and the seller's share of the year's property tax. Title and closing fees are split as the contract says.
Do I owe capital gains tax when I sell land in Rhode Island?
Federal tax applies to any gain. Rhode Island taxes the gain as income at 3.75 to 5.99 percent, and nonresident sellers usually have 6 percent of the payment withheld at closing.
Who pays closing costs when I sell land for cash?
It depends on the contract. When you sell to EasyLotBuyer, we pay the closing costs and you pay no fees or commissions. Back taxes, if any, are paid from the sale at closing.
Are back taxes paid at closing?
Yes. The closing agent pays delinquent property taxes and recorded liens from the sale proceeds, and you receive the balance. You can sell land that has back taxes.