Every seller knows what they want to sell for. Almost none know what they'll actually deposit. The gap between those numbers (payoff, fees, taxes, prorations, prep) is where sellers get surprised. Sale price is what your neighbors talk about; net is what funds your next move. Here's every dollar that comes out between contract and wire, using Tennessee's actual rules rather than national averages.
The Line Items: What Comes Out of Your Sale Price
Between your contract price and your wire at closing, expect deductions in seven categories: mortgage payoff, brokerage compensation, title and settlement charges, government recording and transfer charges, property tax proration, any negotiated buyer concessions or repairs, and your own pre-listing prep spend. Everything else is a variation on one of these.
Here's how each one works in a Tennessee closing:
- Mortgage payoff. Not your statement balance, but the payoff quote, including interest through funding and release fees, plus any HELOC. Usually the largest single deduction.
- Brokerage compensation. Whatever you negotiated in your listing agreement, plus whatever you agreed (or declined) to contribute toward the buyer's agent. There is no standard rate; more on this below.
- Title and settlement charges. In Tennessee it is customary for the seller to pay for the owner's title insurance policy, along with a share of the settlement or closing fee charged by the title company or closing attorney. Premiums come off the title company's rate schedule and scale with price, so get a quote for your specific number rather than relying on a rule of thumb.
- Government charges. Tennessee's realty transfer tax (covered below) is customarily a buyer-side cost here, but recording a release of your mortgage and preparing the deed generate small seller-side fees.
- Property tax proration. You'll credit the buyer for your share of the current year's property taxes through closing day, or receive a credit, depending on when in the tax cycle you close.
- Concessions and repairs. Anything you agree to during inspection negotiations (repair credits, closing cost contributions, home warranty) comes straight off your net.
- Pre-listing prep. The only category you pay before closing rather than at it. Covered in its own section below.
If your purchase agreement includes any seller-paid buyer costs, treat them exactly like a price reduction when you're comparing offers. A $1.6M offer asking for $40K in concessions and a clean $1.56M offer can net you nearly the same. A net sheet lets you compare both side by side.
Taxes When You Sell in Tennessee
Tennessee is one of the most tax-friendly states in the country to sell a home in: there is no state income tax and no state capital gains tax, and the state's transfer tax is customarily paid by the buyer. For most Williamson County sellers, the only tax question that matters is the federal one.
The transfer tax. Tennessee imposes a realty transfer tax of $0.37 per $100 (0.37%) on the recording of deeds, calculated on the greater of the consideration paid or the property's value. Under the statute, the grantee (the buyer) is the party responsible for the tax, though like everything in a purchase agreement, the parties can negotiate who actually pays it. On a $1.5M sale, that's $5,550: meaningful money, and worth knowing it customarily isn't yours.
No state tax on your gain. Tennessee levies no personal income tax; the Hall tax on interest and dividends, the state's last individual income tax, was fully repealed for tax years beginning January 1, 2021. Whatever gain you realize on your home, the State of Tennessee takes none of it.
The federal capital gains exclusion. If the home was your main residence, the IRS allows you to exclude up to $250,000 of gain from income (or up to $500,000 if you file jointly), provided you meet the ownership and use tests: generally, you owned and lived in the home for at least two of the five years before the sale, and you haven't used the exclusion on another sale in the prior two years. In the $1M to $3M price range, long-tenured Williamson County owners can have appreciation that exceeds the exclusion, which makes your cost basis (purchase price plus qualifying capital improvements) worth documenting carefully. IRS Publication 523 has the worksheets, and a CPA is the right person to run yours before you list, not after you close.
Property tax proration. Williamson County property taxes are billed once a year: due and payable from the first Monday in October through the end of February, with interest accruing beginning March 1. Because the bill covers the calendar year, closings are customarily settled with a proration: you're responsible for your slice of the year, credited or debited on the settlement statement depending on whether the current bill has been paid. It's rarely a huge number, but it moves your net one direction or the other depending on where your closing date falls in that cycle.
What Sellers Spend Before Listing
Pre-listing costs fall into five categories (repairs, cosmetic updates, staging, deep cleaning and landscaping, and pre-inspections), and the right budget depends entirely on what the specific house needs to compete at its price point. Anyone quoting you a universal "average prep cost" is guessing.
In the luxury segment, the categories that consistently earn their keep:
- Condition repairs: the items a buyer's inspector will flag anyway. Handling known issues (HVAC service, roof repairs, moisture) before listing keeps them out of negotiations, where they tend to cost more.
- Cosmetic refresh: paint, lighting, hardware. High impact relative to cost, especially in homes that are otherwise well kept.
- Staging and styling: in the $1M+ market, buyers are purchasing a lifestyle as much as a floor plan, and presentation directly affects both photography and showing feedback.
- Grounds and exterior: in Franklin and the surrounding county, lot and curb presence carry real weight; landscaping is usually the cheapest square footage you can improve.
- Pre-listing inspections: optional, but at higher price points they reduce surprises during the inspection period, which protects your negotiating position.
What I'd caution against: major renovations undertaken solely to sell. Big projects rarely return their full cost and delay your listing. Pricing strategy matters more than either. Read how to price a luxury home in Williamson County before you spend a dollar on prep.
Commissions After the NAR Settlement
Real estate commissions are not set by law and never have been. They are negotiable and established by written agreement between you and your broker, and there is no "standard" rate. Since the NAR settlement's practice changes took effect in 2024, the structure is more explicit than it used to be.
Two decisions now sit squarely with you as the seller. First, the listing fee you negotiate with your own agent. Second, whether (and how much) to offer toward compensating the buyer's agent. Offers of buyer-agent compensation can no longer be published on the MLS, but sellers may still choose to offer them off-MLS or as concessions, and buyers now sign written agreements with their agents that spell out what those agents are owed.
In practice, the buyer-agent question usually surfaces inside the offer itself: a buyer obligated to pay their agent may ask you to cover some or all of it as a contract term. Evaluate that like any other concession: by its effect on your net, not by habit. Decide your position before you list, price it into your net sheet, and revisit it offer by offer.
A Realistic Walk-Away Example
Here's the shape of the math on a hypothetical $1,500,000 Williamson County sale: illustrative only, with made-up round numbers for the items that vary by household and quoted rates only where a real rate exists.
| Line item | Illustrative amount |
|---|---|
| Sale price | $1,500,000 |
| Mortgage payoff (hypothetical) | − $600,000 |
| Brokerage compensation (your negotiated rate; every 1% you agree to = $15,000) | − varies |
| Owner's title insurance + settlement fees (quoted from title company rate schedule) | − quote |
| Transfer tax at $0.37 per $100 = $5,550 (customarily paid by the buyer, so often $0 to you) | − $0 to $5,550 |
| Property tax proration | − or + depending on closing date |
| Inspection concessions (hypothetical) | − $10,000 |
| Walk-away (before any federal tax) | the number that matters |
Two things to notice. First, once the payoff comes out, brokerage compensation is typically the largest transaction cost, which is exactly why it's worth a deliberate negotiation rather than an assumption. Second, the tax line most sellers fear (capital gains) may be zero: with no Tennessee tax on the gain and up to $500,000 excluded federally for joint filers who qualify, a couple with a $450,000 gain on their primary residence could owe nothing on it. The math is only scary when nobody's run it.
How to Get Your Actual Number
You can have your real number in about two minutes: run your address through my Net Proceeds Calculator, which builds a line-item estimate using Tennessee-specific costs instead of national averages. Pair it with a professional home valuation so the sale-price input is grounded in what your home would actually command. A net sheet built on a wrong price is just tidy fiction.
If you're within a year of selling, the full selling process is mapped out here, and I'm glad to build your net sheet with you before you commit to anything. Sellers who know their number negotiate differently. Usually better.