Delaware form 5402 instructions-2025

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The document is a Realty Transfer Tax Return and Affidavit of Gain and Value form (Form 5402) for the State of Delaware, which must be completed for all real estate conveyances. It includes sections for the grantor/seller and grantee/buyer to provide identification information, property details, and tax computation. The form outlines the requirements for reporting realty transfer tax, exemptions, and specific instructions for completing each part.

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How to avoid transfer tax in Delaware?

NOTE: In the State of DE, if the purchaser is a First Time Home Buyer, the county transfer tax is waived, except for the following: Purchaser(s) has/have owned property in Delaware or another state. The property will not be occupied as their primary residence within 90 days of the settlement date.

Who pays transfer tax on new construction in Delaware?

About the First-time Home Buyer Tax Credit Realty transfer taxes are typically shared equally by the buyer and the seller.

Who must file a Delaware nonresident tax return?

Non-Residents File a tax return if you have any gross income during the tax year from sources in Delaware. If your spouse files a married filing separate return and you had no Delaware source income, you do NOT need to file a Delaware return.

Who must file Delaware gross receipts tax?

Who is required to pay Delawares Gross Receipts Tax? A. When you engage in business in the State of Delaware, you may be required to pay Gross Receipts Tax. This tax is paid by the seller of goods (tangible or otherwise) or the provider of services in the state.

Who pays the transfer tax in Delaware?

In Delaware, traditionally, both the buyer and seller pay the costs of the transfer tax, splitting the total amount, usually levied at a rate of 4% of the purchase price. First-time home buyers receive a 0.5% reduction in their rate, lowering it from 1.25% to 0.75%, claimable at closing.

What is the construction tax in Delaware?

The State of Delaware assesses the tax at the rate of 2% on the amount of the construction contract after deducting a $10,000 exclusion. Sussex County requires the payment of 1.5% on the total construction contract amount, plus proof that the State portion has been paid, before they will issue the building permit.

Who typically pays real estate transfer taxes?

Understanding Transfer Taxes A transfer tax on real estate may be imposed by state, county, or municipal authorities for the privilege of transferring real property within the jurisdiction. The government is effectively taxing the transfer of a legal deed, certificate, or title from a seller to a buyer.

Who must file Delaware partnership tax return?

A PARTNERSHIP RETURN MUST BE COMPLETED BY ANY BUSINESS TREATED AS A PARTNERSHIP FOR FEDERAL PURPOSES WHICH HAS ANY INCOME OR LOSS, REGARDLESS OF AMOUNT, DERIVED FROM OR CONNECTED WITH A DELAWARE SOURCE. IF THE PARTNERSHIP HAS NO DELAWARE SOURCED INCOME OR LOSS, NO RETURN IS REQUIRED TO BE FILED.

Delaware form 5402 instructions-2025

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