Hawaii Real Estate State Practice Exam 2026 – The Comprehensive All-In-One Guide to Exam Success!

In an agreement of sale transaction, the conveyance tax is typically excluded from both closings because it is generally a state-imposed fee that must be paid when property is transferred from one owner to another. This tax is calculated based on the sale price of the property and is usually paid by the seller, though the responsibility can be negotiated between the parties involved.

The conveyance tax is separate from other closing costs like title searches, preparation of documents, and escrow fees, which are usually part of the transaction's closing expenses. Title searches and document preparations are necessary to ensure that the property title is clear and that all legal documents are correctly drafted for the transfer. Escrow fees pertain to the holding of funds and documents by a neutral third party during the transaction. None of these fees fall under the category of taxes imposed by the state specifically for the act of transferring property ownership, which is why the conveyance tax stands out as the correct answer.