In a Georgia intangible tax refinance, the state charges $1.50 per $500 (or fraction) of the new note, about 0.3%. If you refinance with your original lender, only new money is taxed. If you switch lenders, the whole note is taxed, about $900 on $300,000. Add the tax to your closing costs, then divide by your monthly savings to find your break-even point.
Say you have two refinance quotes. One is from the company you already pay each month. The other is from a new lender with a slightly lower rate. The new quote saves more each month, but the taxes line on its Loan Estimate is several hundred dollars higher. That difference is usually Georgia's intangible recording tax. It is a one-time cost at closing, and it changes how long it takes a refinance to pay for itself. This guide covers how the tax works, when the same-lender exemption applies, and how to put the tax into your break-even math.
What the intangible recording tax is
Georgia taxes security deeds that secure long-term notes. The rate is $1.50 for each $500, or fraction of $500, of the note's face amount (Ga. Comp. R. & Regs. R. 560-11-8-.02). That comes to about 0.3% of the loan.
Because of the "or fraction" wording, you always round up. The formula is:
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Round the loan amount up to the next $500.
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Divide by 500.
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Multiply by $1.50.
For example, a $300,250 note rounds up to 601 units, so the tax is $901.50, not $900.75. A $300,000 note is exactly 600 units, or $900.
The tax is capped at $25,000 per instrument. The cap only applies to notes above roughly $8.33 million, so it will not affect a typical home refinance.
According to the Georgia Department of Revenue, the tax has to be paid before the instrument is recorded, and the instrument has to be recorded within 90 days of signing. Unpaid tax carries a 50% penalty plus 1% interest per month. In most counties the Clerk of Superior Court collects it. In 24 smaller counties (population 50,000 or less), the tax collector or tax commissioner collects it instead.
One cost you will not see: Georgia's transfer tax does not apply to a refinance. Transfer tax is charged on deeds that convey property, and a refinance does not convey property.
The same-lender rule in plain English
Georgia law contains a refinance exemption. Under O.C.G.A. 48-6-65(b), no tax is collected on "that part of the face amount of a new instrument securing a long-term note secured by real estate which represents a refinancing by the original lender of unpaid principal on a previous instrument."
The Department of Revenue's rule, Ga. Comp. R. & Regs. R. 560-11-8-.05, says the exemption applies to a refinancing "by the original lender and original borrower." Two conditions must be met:
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The earlier tax was paid. Tax must have been paid on the previous security deed, or that loan must have been exempt.
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The refinanced amount is stated. The new security deed has to say how much of its face amount is refinanced principal, either on the document itself or in an affidavit from the holder.
If both conditions are met, only the new money is taxed. Georgia Title & Escrow gives this example: a $500,000 loan is refinanced after five years as $475,000 of unpaid principal plus $25,000 of new cash. The tax is $75, charged on the $25,000. It is not $1,500 on the full $500,000.
The catch: your servicer may not be your lender
This is where many borrowers get tripped up. The company you send payments to is your servicer, and it may not own your loan. Many loans are sold after closing. Georgia title practitioners generally read "original lender" to mean the lender still holds the loan. Origin Title & Escrow, for example, says the same-lender savings apply only "if your previous loan has not been sold."
The statute itself says "original lender" and does not use words like "still owned," so don't assume either way. Before you count on the exemption, ask your closing attorney two questions:
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Who holds my note today, and does that count as the original lender for this exemption?
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Will the new security deed, or a holder affidavit, state the refinanced principal amount?
If the exemption doesn't apply, the whole new note is taxed, even when you refinance with the company you already pay.
How to do the break-even math
Break-even tells you how many months of lower payments it takes to earn back what the refinance cost. In Georgia, the intangible tax belongs in the cost total.
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Add up the closing costs from the Loan Estimate. Include lender fees, title and attorney charges, and the intangible tax, which appears in Section E, "Taxes and Other Government Fees."
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Find your monthly savings. Subtract the new principal and interest payment from your current principal and interest payment.
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Divide total closing costs by monthly savings. The result is the number of months until you break even.
| Worksheet line | Your numbers | | --- | --- | | A. Lender, title and attorney costs | $ | | B. Intangible recording tax (Section E) | $ | | C. Total closing costs (A + B) | $ | | D. Current principal and interest payment | $ | | E. New principal and interest payment | $ | | F. Monthly savings (D minus E) | $ | | G. Months to break even (C divided by F) | |
Worked example A: a $300,000 rate-and-term refinance
The cost and savings figures in this example are illustrative, not quotes. The tax figures come from the statutory rate. Assume a $300,000 unpaid balance, a new note for the same $300,000, $5,000 of other closing costs paid in cash, and $160 a month in principal and interest savings.
| Scenario | Other costs | Intangible tax | Total costs | Monthly savings | Break-even | | --- | --- | --- | --- | --- | --- | | Original lender, exemption applies | $5,000 | $0 | $5,000 | $160 | About month 32 | | New lender, full note taxed | $5,000 | $900 | $5,900 | $160 | About month 37 |
With the original lender, no new money is borrowed, so the tax on the refinanced principal is $0. With the new lender, the full $300,000 is taxed at 600 units times $1.50, or $900. At the same monthly savings, the tax pushes break-even back about five months.
On a bigger loan the effect grows. On a $400,000 refinance with $150 a month in savings, the tax with a new lender is $1,200 (800 units). That $1,200 alone adds eight months to break-even. On a $250,000 note, the tax with a new lender is $750.
Worked example B: rolling in costs or taking cash out
Any money you add to the balance is new money, so it is taxed with any lender. What changes is how much of the loan is taxed.
Say you roll $5,000 of closing costs into the $300,000 refinance, for a new note of $305,000 (illustrative):
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Original lender: only the $5,000 of new money is taxed. That is 10 units, so $15.
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New lender: the whole $305,000 is taxed. That is 610 units, so $915.
Cash-out refinances follow the same logic. In the Georgia Title & Escrow example above, $25,000 of cash out with the same lender costs $75 in tax. With a new lender, the entire new note is taxed.
Rolling costs in also changes the break-even math. You pay nothing up front, but you pay interest on the rolled-in amount for as long as you carry the loan.
When switching lenders still wins
The tax does not automatically make your current lender the better choice. A lower rate, smaller fees or a lender credit from the new lender can more than cover $900. Use this rule of thumb to compare two offers:
Extra tax divided by the extra monthly savings equals the months it takes the new lender's offer to catch up.
An illustrative case: your current lender's quote costs $5,000 and saves $160 a month. The new lender's quote has a lower rate that saves $185 a month, but it costs $5,900 including the $900 tax. The new lender saves $25 more per month, so it recovers the extra $900 in 36 months ($900 divided by $25). If you expect to keep the loan more than three years, the new lender comes out ahead. If you might sell or refinance again sooner, the current lender's quote is the better deal.
The longer you plan to stay, the less a one-time tax matters. If the new lender offers a credit about as large as the tax, the tax difference mostly goes away.
Side cases worth knowing
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Loan modification or extension. Under Rule 560-11-8-.04, modifications by extension, transfer, assignment or renewal, and deeds that add security, owe no tax if tax was paid on the original instrument. If you are comparing a modification with a refinance, this is one cost the modification may avoid. Ask your attorney whether your specific change qualifies.
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A new HELOC. Secured lines of credit are taxed on the total line amount, whether you draw on it or not (Georgia rules, Subject 560-11-8). When comparing a HELOC with a cash-out refinance, figure the tax on the full line, not on the amount you expect to use.
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HB 586 and the 62-month rule. HB 586 was signed May 9, 2025, and took effect July 1, 2025. It raised the short-term exemption from 36 months to 62 months, so a note whose entire principal is due within 62 months is exempt. It applies to instruments recorded on or after July 1, 2025 (Troutman Pepper Locke; BBGA). The change helps 5-year balloon and some portfolio or commercial loans. Standard 15-year and 30-year refinances are still taxable.
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No refund on the old loan. When you switch lenders, you get nothing back for the intangible tax paid on your existing loan. The new lender's tax is a fresh one-time cost.
Checklist before you sign
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Ask your current lender for a refinance quote, and ask whether it still owns your note or has sold it.
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Get Loan Estimates from at least one other lender. Compare Section E line by line, then compare total closing costs.
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Work out break-even for each offer using total costs, including the tax.
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If the offers differ in both tax and savings, divide the tax difference by the savings difference to see how long the lower-rate offer takes to catch up.
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Decide whether to pay costs in cash or roll them in, and remember that rolled-in costs are taxed as new money.
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If you are using your original lender, confirm with your closing attorney that the new security deed or a holder affidavit will state the refinanced principal.
Where rates stand, and what break-even leaves out
In Freddie Mac's Primary Mortgage Market Survey for September 3, 2026, the average 30-year fixed rate was 6.71%, up from 6.66% the week before and 6.50% a year earlier. The 15-year fixed averaged 6.04%, up from 5.60% a year earlier. These are national averages, and your quote depends on your credit, equity and loan type. Nobody can reliably say where rates go next, so base your decision on the quotes you have in hand.
Break-even is a planning number, not a verdict. It doesn't show that resetting to a new 30-year term can lower your payment while raising the total interest you pay over the life of the loan. Run the break-even math with the intangible tax included, then compare total interest over the time you expect to keep the loan.
Related reading
Sources
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O.C.G.A. 48-6-65, intangible recording tax exemptions (FindLaw)
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Ga. Comp. R. & Regs. R. 560-11-8-.05, Refinancing (Cornell LII)
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Ga. Comp. R. & Regs. R. 560-11-8-.02, Tax Payment and Rate (Cornell LII)
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Ga. Comp. R. & Regs. R. 560-11-8-.04, Modification (Cornell LII)
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Refinancing and Intangible Tax (Origin Title & Escrow, Sept. 9, 2020)
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New Georgia Law Extends Intangible Tax Exemption Period for Real Estate Loans (BBGA, June 17, 2025)
