Alabama Deed Tax: 50 Cents per $500, Explained (2026)

Updated October 2026. Ala. Code § 40-22-1, the Alabama Department of Revenue and probate court fee pages checked on October 31, 2026.

Alabama’s deed tax is 50 cents for every $500 of value, rounded up to the next $500. As of October 2026, a $300,000 cash sale owes $300. If the buyer’s purchase mortgage is recorded at the same time, the tax only applies to the part of the price above the loan, so an 80% loan cuts it to $60. It’s paid to the probate judge when the deed is recorded.

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Jump to: 🧮 The math · 🏦 The mortgage credit · 📊 Examples · 🤝 Who pays · 📝 Form RT-1 · 💲 Other costs · ❓ FAQ

How is the Alabama deed tax calculated?

The rule sits in Ala. Code § 40-22-1(c). A deed for property worth $500 or less pays 50 cents. Above that, you pay 50 cents for each $500 “or fraction thereof.” The Alabama Department of Revenue lists the same rate: $.50 per $500 of value.

“Or fraction thereof” means you always round up. The Mobile County Probate Court gives the example plainly: a $501 value rounds up to $1,000, so the tax is $1. In practice, that’s how to do it:

1. Take the taxable value (usually the sale price).
2. Divide by 500 and round up to a whole number.
3. Multiply by 50 cents.

On a $287,250 sale, 287,250 ÷ 500 is 574.5, which rounds up to 575. The tax is $287.50. That’s why Alabama numbers often end in 50 cents.

How does the buyer’s mortgage lower the deed tax?

This is the part most sellers never hear about. Section 40-22-1(c) taxes only “the value in excess of any mortgages or vendor’s lien” on the property, as long as mortgage tax has been paid on that loan. In Alabama, the buyer’s lender records a mortgage, and that mortgage pays its own tax of 15 cents per $100.

The Mobile County Probate Court explains how it applies: when the deed and a purchase money mortgage are recorded together, deed tax is figured on the price above the mortgage, if the lender is a taxable institution and mortgage tax is collected. If the loan comes from a lender that doesn’t pay the tax, deed tax is charged on the full value.

The same idea applies to a buyer who assumes your mortgage. Mobile County taxes only the equity, if the deed references where the existing mortgage is recorded and it was made to a taxable lender.

What will the deed tax be on your Alabama sale?

Here’s the math at common prices, for a cash buyer and for a buyer with a loan of 80% of the price recorded with the deed. Mortgage tax is shown so you can see the full recording bill. It sits on the buyer’s loan.

Compare that with the cost of selling itself. As an example only, a 3% listing commission on a $300,000 home would be $9,000. Commissions are not set by law or NAR rules and are negotiable, you choose whether to offer anything to a buyer’s agent, and since August 17, 2024 those offers can’t appear on the MLS. Beycome Basic is $99, with $0 due to Beycome at closing.

Who pays the deed tax in Alabama, the buyer or the seller?

The statute doesn’t say. Section 40-22-1(a) only says a deed can’t be recorded until the tax is paid. Who hands over the money is a term of your purchase contract, so read that line before you sign.

Because the amount is small, it rarely blocks a deal. But if a buyer asks you to cover all recording costs, know the numbers first: on a financed $300,000 sale, the deed tax may be $60 while the buyer’s mortgage tax is $360. Our guide to who pays closing costs covers how buyers and sellers usually split the rest.

What is Alabama’s Form RT-1, and do you need it?

Since a 2012 change to § 40-22-1, a deed offered for recording must come with proof of the actual price, or of the actual value if there’s no sale. The Department of Revenue created a short form for that: the Real Estate Sales Validation Form, Form RT-1.

The form asks for the grantor and grantee, the property address, the sale date, and the total price or actual value. You also check what backs up the number, such as a sales contract or closing statement. If the deed itself already shows all of that, the form isn’t needed. Whoever signs it attests that it’s accurate.

Skipping proof has a cost. Under § 40-22-1(d), the probate judge then taxes the most recent assessed value instead. And under subsection (h), a person who intentionally fails to give proof after being asked, or gives false proof, pays a penalty of $100 or 25% of the tax, whichever is greater. A form signed in good faith doesn’t trigger it.

Which Alabama deeds don’t owe deed tax?

Section 40-22-1(b) lists a few, and none covers a normal sale:

• Transfers of mortgages on which mortgage tax was already paid.
• Deeds for a nominal amount, made only to perfect the title.
• Re-recorded corrected deeds or mortgages, such as a fixed maturity date.

When no tax is collected, the probate judge stamps “No Tax Collected” on the deed. Jefferson County charges $1 for that stamp.

What else does an Alabama seller pay at recording and closing?

Recording fees vary by county. As examples, the Jefferson County Probate Court charges $16 for the first page and $3 for each extra page. Mobile County lists $2.50 per page plus several small fixed fees. Your closing company will show the exact amounts.

If you don’t live in Alabama, plan for one more line. Ala. Code § 40-18-86 makes the buyer withhold state income tax when a nonresident sells Alabama real estate: 3% of the price for individual buyers and 4% for business buyers. You can file the Department of Revenue’s affidavit to base it on your gain instead. Your closing agent handles the forms.

Then come payoff, prorated property taxes, title or attorney fees and anything you’ve agreed to cover. You’ll need your parcel number for the paperwork; our Alabama parcel number guide shows where to find it. For a full net sheet, try our cost of selling calculator.

Where does Alabama’s deed tax money go?

Two-thirds goes to the state General Fund and one-third to the county, according to the Department of Revenue. If one deed covers land in several counties, the Department of Revenue splits the value between them and each county gets its share.

Selling your Alabama home with a flat fee listing

The deed tax won’t change much however you sell. The listing cost will. Hiring an agent isn’t required in Alabama; it’s your choice, and both paths are fair. Beycome is a full platform to sell, buy and close: Basic is $99, Enhanced is $399, and Concierge is $1,399 (its list price), with an expert who works with you and keeps every decision yours. Your home goes on the major home search sites and the MLS that covers your area. Read our Alabama selling guide for the full path.

22,000+ homeowners have sold with Beycome and saved over $225 million (Beycome internal data, October 2026). Start your Alabama listing.

Alabama deed tax FAQ

Reviewed by Beycome Brokerage Realty LLC, licensed real estate brokerage (AL #000135327). Licenses: beycome.com/faq/how-to/are-you-a-licensed-broker/.