Not sure what a transfer stamp is or who pays it when you buy or sell in Naperville? You are not alone. Transfer taxes can be confusing because the rules stack at the state and local levels, and practices vary by city. In this guide, you will learn what the Illinois transfer tax covers, how municipal “stamps” in DuPage can affect your closing costs, and the simple steps to verify the exact amount before you sign. Let’s dive in.
What transfer taxes are in Illinois
Real estate transfer tax is a charge on the transfer of real property that is collected when the deed is recorded. In Illinois, you may see more than one layer at closing:
- The state real estate transfer tax
- Any county or municipal transfer tax, sometimes called a documentary stamp
- Recording fees, which are separate from transfer taxes
The county recorder typically collects required transfer taxes at the time of recording and will not record the deed unless taxes are paid or a valid exemption is documented. You can learn more about state-level rules and forms from the Illinois Department of Revenue and statutory language through the Illinois General Assembly.
Illinois state transfer tax at a glance
Illinois charges a state real estate transfer tax of $0.50 for every $500 of consideration. That equals $1 per $1,000, or 0.1 percent of the sale price. The tax is collected at recording by the county recorder.
- Example: A $400,000 sale price results in a $400 state transfer tax.
This state tax applies statewide. Local governments can add their own transfer taxes, but they do not replace the state tax. For current procedures and forms, refer to the Illinois Department of Revenue.
DuPage and municipal stamps: what changes by city
In DuPage County, many municipalities adopt their own local transfer taxes or documentary stamps. The amount and format vary by ordinance. Some cities express their tax as a dollar amount per $500 of price, while others use a percentage. Some municipalities do not impose a local transfer tax at all.
The DuPage County Recorder’s Office enforces these requirements at recording. If a municipal stamp or payment is required and not provided, recording can be delayed. To confirm collection practices and recording procedures, start with the DuPage County website and contact the recorder if needed. You can also look up specific municipal codes through Municode.
Who pays the municipal tax often comes down to contract negotiation, even when an ordinance assigns legal liability. Your settlement statement will show the agreed allocation.
Naperville closings: what to confirm
Before you close on a property in Naperville, confirm whether the city imposes a municipal transfer tax and how it is calculated. Because ordinances can change, always verify current details directly from official sources:
- Check the City of Naperville website for transfer tax or finance pages, or contact the city clerk or finance office.
- Search Naperville’s municipal code on Municode for “real estate transfer tax” or “documentary stamp.”
- Ask the DuPage County Recorder through DuPage County to confirm collection requirements that will apply at recording.
Once you know whether a Naperville municipal tax applies, ask your title company or closing attorney to add it to your pre-closing itemization and your Closing Disclosure.
How to verify a municipal rate yourself
Identify the property’s municipality. Do not assume by mailing address alone.
Search the city’s code on Municode for “transfer tax,” “real estate transfer tax,” or “documentary.”
Visit the city’s website, such as the City of Naperville, or call the city clerk or finance office to confirm current rates and procedures.
Confirm collection details with the DuPage County Recorder via DuPage County, since taxes are enforced at recording.
Ask your title company for a written citation of the ordinance and a pre-closing calculation that shows the state tax, any municipal tax, and recording fees.
Who usually pays transfer taxes
There is a difference between legal liability and what happens in practice. The government requires the tax to be paid at recording, but it does not always dictate who pays. Many municipal ordinances assign the liability to one party. In everyday transactions, payment is typically negotiated in the purchase contract.
- Sellers often pay some or all transfer taxes in suburban markets, but that is not a rule. It is a contract term.
- Always confirm your contract’s allocation and review the Closing Disclosure to ensure the charges match your agreement.
If you are unsure, ask your title company to point you to the supporting ordinance and highlight who is paying each line item.
Common exemptions and documentation
Some transfers are exempt from transfer taxes, but exemptions differ between state and municipal rules. Common examples include transfers between spouses or incident to divorce, transfers to or from governmental entities and certain non-profits, and certain court-ordered transfers. If you believe an exemption applies, verify the exact rules and required paperwork ahead of time.
- The recorder can refuse to record without payment or proper exemption documentation, which can delay closing.
- Some exemptions require specific affidavits or pre-approval. Confirm with your title company and consult official resources like the Illinois Department of Revenue and the Illinois General Assembly for statutes.
Quick calculations you can use
Start with the state tax, which is fixed, then add any municipal tax.
- State tax formula: Sale price ÷ 500 × $0.50
- Example: $400,000 sale ÷ 500 = 800. Then 800 × $0.50 = $400 state tax.
For municipal tax, use the formula that matches the ordinance format.
- If expressed per $500: Sale price ÷ 500 × municipal dollar rate
- If expressed as a percent: Sale price × municipal percentage
Hypothetical example only, for structure: If a municipal rate were $2.50 per $500 on a $400,000 sale, the local tax would be 800 × $2.50, which equals $2,000. Always verify any actual Naperville rate directly with the city or through Municode before closing.
What to expect on your settlement statement
Your Closing Disclosure or settlement statement should show separate line items for each of the following:
- Illinois state transfer tax
- Any DuPage County or municipal transfer tax, if applicable
- Recording fees and documentary charges
If your contract assigns transfer tax payment to a specific party, the statement should reflect that allocation. Ask your title company to provide a pre-closing itemization so you can review these charges early.
Buyer checklist: Naperville and DuPage
- Request a preliminary Closing Disclosure that itemizes state transfer tax, any municipal transfer tax, and recording fees.
- Ask your title company for the municipal ordinance citation that supports any local tax.
- Confirm who pays each tax according to your purchase contract, and check that the settlement statement matches.
- If you claim an exemption, request proof that the recorder will accept it.
- Bring valid ID and funds needed for cash to close.
Seller checklist: Naperville and DuPage
- Review the purchase contract to confirm who pays the transfer tax.
- Request a pre-closing statement that breaks out all transfer taxes and fees.
- If claiming an exemption, send required documents to your title company early.
- After closing, obtain the recorded deed and transfer stamp receipt for your records.
How to avoid last-minute delays
- Verify the property’s municipality and whether it requires a local stamp.
- Confirm the current local rate through the city code and clerk or finance office.
- Ensure the purchase contract clearly assigns who pays each transfer tax.
- Have your title company show the exact calculation and provide ordinance citations.
- Confirm any exemption documentation is complete and acceptable to the recorder.
When you want a smooth closing and clear answers on transfer taxes, local guidance makes all the difference. If you have questions about your specific situation in Naperville or anywhere in DuPage, reach out to Timothy Good for personalized support from a local team that manages the details from contract to close.
FAQs
Who pays transfer tax in a typical Naperville home sale?
- The purchase contract usually decides who pays, and while an ordinance may assign liability, the parties often negotiate the split and the title company reflects it on the settlement statement.
What is the Illinois state transfer tax rate right now?
- Illinois charges $0.50 per $500 of consideration, which equals $1 per $1,000 or 0.1 percent of the sale price, and it is collected when the deed is recorded.
How do I find out if Naperville has a municipal transfer stamp?
- Check the City of Naperville website, search Naperville’s municipal code on Municode, or ask your title company for the ordinance citation and current rate.
Are there exemptions from transfer taxes in Illinois?
- Yes, common exemptions include transfers between spouses, certain transfers to or from governmental entities or qualifying non-profits, and some court-ordered transfers, but each exemption requires specific documentation.
What happens if taxes are not paid at recording?
- The county recorder can refuse to record the deed until the required tax or valid exemption documentation is provided, which can delay your closing.
