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What is the RP-5217 form and why is it important?

What is RP-5217? RP-5217 (better known as a NY Real Property Transfer Tax form) is what the transferor has to fill out when they are selling or transferring title on a New York real property. RP-5217 is used when there is either a sale, gift from a parent to child, inheritance, or distribution by court order. RP-5217 ensures that the person who transfers the title will be properly taxed with regard to transfer tax.

If you have dealt with this type of real estate transaction before you know how important this form can be. RP-5217 will ensure that all proper taxes have been paid on your transaction; it will also benefit you and your seller in ensuring that there are no adverse future tax repercussions from an “arms-length” sale.  In this situation, RP-5217 is an essential document that must be filled out properly before transferring the title.

In deals such as these, it is incredibly important to work with an experienced local real estate attorney and title company.   The attorney will be able to determine which taxes are applicable and how much they will costyou. For example, if in the purchase of a property, the buyer agrees to pay the transfer taxes that are normally paid by the seller, then those taxes must be included in the sale price of the property and thereby increasing the amount of consideration subject to the transfer taxes. The title company will ensure that all transfer taxes have been accounted for and properly calculated.

This form is required to accompany the deed to your home when it is presented for recording. Without the RP-5217 the deed will not be accepted for recording which could potentially bring your ownership of real estate into question. If there is ever a situation where it is discovered that your current title does not account for all proper fees and payments made at the time of sale, you could held liable for not only the payment of the full amount of the taxes due, but also penalties and interest.

When you purchase real estate, there are many steps involved in transferring ownership from old owners to new owners. These steps, which include signing papers, completing legal processes, paying various transfer taxes and fees (notary fees, attorney fees, recording fees) can become very confusing if they are not properly accounted for.  It is crucially important that you double-check all of the work done in a real estate transaction, even if it is done by the other party.  Just because you have professionals on your side doesn’t mean the same is true for the people buying your property or selling you theirs.  A real estate attorney can help you sort out any problems that may come up after the closing, but it is much better if you prevent them in the first place. If you are on the seller’s side of things, securing a good title company like MacGregor Abstract to make sure your paperwork is done correctly and transferred from old owners (you) to new owners (buyers), will be key to ensuring everything goes smoothly when it comes time for closing.

The title insurance company will also issue a Title Insurance Policy on any property transfer. This insurance policy, which protects both buyers from potential hazards or problems with the title of the property being transferred, is one of the many steps to ensure your investment is protected as well as giving you the reassurance that everything was done properly.