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Documentary stamp tax
Also called doc stamps, documentary stamps, doc stamp tax.
A state excise tax on written obligations to pay money, encountered most often in Florida, charged on notes and similar documents signed or delivered in the state.
Drafted with AI assistance. Not yet independently checked. Nobody has verified the claims on this page against a source, so treat the figures and legal points as a starting point rather than as settled, and confirm anything you are about to act on. How we check things.
What it means
This is a tax on documents, not on transactions. Florida imposes it on promissory notes, written obligations to pay money, and certain other instruments executed or delivered in the state, at a rate set per increment of the obligation, with a statutory cap for obligations not secured by Florida real property. The rate and the cap are statutory and change; confirm the current figures rather than relying on a number in a term sheet.
A few other states impose analogous taxes on particular instruments, and mortgage recording taxes in states such as New York operate on similar logic for secured real estate debt.
In small-business funding it appears as a closing line item deducted from proceeds, usually labeled "doc stamps" or bundled into an administrative charge, most commonly on files with a Florida-based recipient or a Florida-based funder.
Where this one catches people
Whether a specific financing document is taxable depends on what the instrument is, where it was executed or delivered, and the state's statute. A purchase-of-receivables agreement is not self-evidently a promissory note. The charge nonetheless shows up on statements for merchants with no obvious Florida connection. Ask which document is being taxed, under which state's statute, and whether the amount is being remitted to that state.
Where you will meet this term
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Documentary stamp tax — common questions
What does documentary stamp tax mean?
A state excise tax on written obligations to pay money, encountered most often in Florida, charged on notes and similar documents signed or delivered in the state.
Where does documentary stamp tax catch people out?
Whether a specific financing document is taxable depends on what the instrument is, where it was executed or delivered, and the state's statute. A purchase-of-receivables agreement is not self-evidently a promissory note. The charge nonetheless shows up on statements for merchants with no obvious Florida connection. Ask which document is being taxed, under which state's statute, and whether the amount is being remitted to that state.
Is documentary stamp tax the same as an interest rate?
Documentary stamp tax is defined above; if you are comparing it against a rate, check whether the two measures share a time dimension before you put them side by side.
Which products does documentary stamp tax apply to?
Merchant Cash Advance, Working Capital, Term Loan.
Is there a worked example of documentary stamp tax?
Not on this entry. Where a term is arithmetic, the arithmetic is shown; this one is not primarily a calculation.
What else should I read alongside documentary stamp tax?
Closing costs, Disbursement, Fee schedule, Funding statement, Promissory note.
Has this definition been checked?
Not yet. This entry is drafted and live, and the notice at the top says so. Confirm anything you are about to act on.
Is this legal advice?
No. It is a definition. What a clause does in your contract, in your state, is a question for a lawyer licensed where you are.
Can I suggest a term?
Yes — [email protected]. The glossary grows from what people are actually shown in contracts.