In Ohio, the transfer tax is based on the "value of the real property or interest in real property located within the boundaries of the county granted, assigned, transferred, or otherwise conveyed by the deed." Thus, the transfer tax is based on the value, not the sales price. However, in an arm's length transaction, the best measure of value is the sales price.
There can be a difference in the value or sales price, and the mortgage. The mortgage could include property in another county, where a separate, and similar mortgage is filed. You said this is residential property, but in a commercial transaction, part of the sales price could include personal property not subject to the transfer tax.
In Ohio, if there appears to be discrepancy between the amount shown for transfer tax purposes and the value of the property, I believe that the Department of Taxation could invstigate and send an letter inquiring of the circumstances. I have seen this where a motor vehicle is transferred for $0.00 - and it appears that the sales price was listed as zero to avoid sales tax. However, there is often a legitimate reason, such as a gift to a relative, and the Department will give the parties a chance to explain the unusual ccircumstances.
I am curious... what does the county show as the value of the property for tax purposes? That might give an indication of whether the appropriate tax was paid, but it is certainly not conclusive.
Best,
Robert A. Franco
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