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Alabama Closing Cost Calculator
Alabama deed tax is $0.50 per $500 of value, charged only on the part not covered by a mortgage on which mortgage tax was paid. Work out deed tax on the taxable value remaining after a qualifying mortgage exclusion, then add your settlement quotes.
Alabama deed tax and settlement worksheet
Ordinary taxable deed under section 40-22-1: $0.50 per $500 or fraction, with a $0.50 minimum. Only the value above qualifying mortgages or vendor liens on which mortgage tax has been paid is taxable. Confirm that deductible amount or enter the final taxable base. Mortgage tax itself, exemptions and recording fees are separate.
Calculate the taxable equity before rounding
Alabama Code 40-22-1 limits the deed-tax base to value above qualifying mortgages or vendor liens on which mortgage tax has been paid. A loan balance alone does not establish that the exclusion applies. Ask the probate office or deed preparer to confirm the eligible amount.
The worksheet subtracts that confirmed amount from the entered price. Alternatively, provide the final taxable value directly; this override is already net of the exclusion, so the mortgage field is not subtracted again. Blank financing information does not silently mean that all of the price is taxable.
Half-dollar blocks and the minimum charge
The Department of Revenue lists deed tax at $0.50 for every $500 of value or fraction. A $300,000 cash sale with no exclusion produces $300. With a confirmed $240,000 exclusion, $60,000 remains and the tax becomes $60.
One extra cent above that $60,000 base moves the calculation to 121 blocks and $60.50. When eligible financing covers the entire price, the ordinary deed still has a $0.50 minimum, as shown in Houston County's probate fee guidance. A statutory exemption needs separate confirmation.
Alabama deed-tax worked examples
| Scenario | Taxable value | State tax | Local amount | Tax subtotal |
|---|---|---|---|---|
| Cash sale: no qualifying mortgage exclusion | $300,000.00 | $300.00 | $0.00 | $300.00 |
| Confirmed $240,000 exclusion | $60,000.00 | $60.00 | $0.00 | $60.00 |
| Fully financed, qualifying exclusion confirmed | $0.00 | $0.50 | $0.00 | $0.50 |
| Taxable equity crosses a $500 block | $60,000.01 | $60.50 | $0.00 | $60.50 |
Keep mortgage tax and filing charges separate
Alabama also taxes covered debt instruments at $0.15 per $100 or fraction. That charge is separate from the deed tax displayed here. A qualifying mortgage exclusion changes the deed's taxable base; it does not mean the mortgage was recorded free of tax.
Get an itemized recording quote for the actual deed and financing documents. Page counts, indexed names and local filing charges can affect the invoice. If a provider combines these charges, enter the combined amount once. This calculator does not assume that Houston County's filing fees apply statewide.
Move the agreed share into your closing budget
Supply the seller share from your contract; the buyer receives the remainder. A $60 tax allocated equally contributes $30 to each side. A buyer's confirmed $45 transfer-tax quote replaces that $30 model share rather than adding to it.
Add title charges, lender costs and reserves from your own documents. Buyer cash to close also includes the down payment and subtracts deposits and credits. Seller proceeds subtract the selected costs, agreed commission, credits and payoff. Check these inputs against the settlement statement before relying on the subtotal.
| Parameter | Amount or rule | In effect | Primary source |
|---|---|---|---|
| Deed tax | $0.50 per $500 of value or fraction | Current DOR listing | Alabama DOR recordation tax (Code of Alabama 40-22-1) |
| Mortgage tax | $0.15 per $100 of indebtedness or fraction | Current DOR listing | Alabama DOR recordation tax (40-22-2) |
| Probate filing, Houston County only | $13 filing fee plus $3 per page for a deed or mortgage; $1 for each indexed name beyond two | Since August 1, 2019 | Houston County Probate Office |
Worked mortgage-tax example
The Department of Revenue lists the mortgage tax at $0.15 for each $100 of indebtedness or fraction. On a $300,000 purchase with a $240,000 mortgage, that is 2,400 units and $360. The deed tax on the remaining $60,000 is $60, so the two recordation taxes together come to $420. A loan of $240,000.01 uses 2,401 units and $360.15.
Filing fees are set county by county. In Houston County, a four-page deed files for $13 + 4 × $3 = $25 and a fifteen-page mortgage for $13 + 15 × $3 = $58, before any extra indexed names. Another probate office may charge differently, so use its own schedule; the worksheet takes the mortgage tax and filing fees as quotes.
Last reviewed 2026-10-09. Calculation methodology.
Questions about Alabama
- Does Alabama deed tax always use the full purchase price?
- No. Section 40-22-1 excludes qualifying mortgage or vendor-lien value on which mortgage tax has been paid. Confirm the eligible amount with the recording office or deed preparer. The model requires that amount, including a confirmed zero, or a final taxable-value override.
- Is Alabama deed tax zero when there is no taxable equity?
- For the ordinary taxable deed modeled here, the minimum is $0.50. A fully exempt deed is a separate classification; enter a confirmed tax quote rather than treating a financing exclusion as a full exemption.