Doc Stamps

                                                                                         

Normally when subject to's are done, you will then have to deal with the issue of the documentary stamps, also otherwise known as doc stamps. There can be many legalities to these and there different ways to handle them. As an investor, you have to make your own decisions. You're taking titles in land trust.

When that seller deeds that property to you in a land trust by law you're, somebody is entitled to pay the doc stamps. Documentary Stamps is a state tax that is in the form of stamps that is needed on mortgages and deeds when the title is moved from one owner to a new one. The amount of these can vary greatly from state to state. However, since the county does not know that the seller did not put the title into their own land trust, the county has a hard time collecting doc stamps because they're not due if you put your property in a land trust for your benefit for your estate planning. Now in all truthfulness, most investors of course take title in a land trust and screw the state out of their doc stamps. The down side to doing this is in the event that they get caught. If this happens, somebody has got to pay the doc stamps. And, of course, that is usually going to be the responsibility of the poor person who happens to own the property at that time they discover it. Many may not know that the county can put a lien on the property for the doc stamps if they believe they are due.

So it is not necessarily one particular person who is liable for paying the doc stamps, it is the property owner who is responsible. And in reality, those doc stamps are supposed to be paid in every state every time title transfers.

It is really not all that difficult to understand. What will happen is the county will just send you a bill for them. They will also ask you why the doc stamps were not paid at the time, and they may not notify you for up to a year from the transaction date depending on what state you are in.

Also keep in mind that in some states, they are not called doc stamps. Some states call them transfer fees or transfer taxes. They are all the same thing...

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