In an effort to increase revenues, the State of New Jersey has revamped the so-called Mansion Tax (MT.) Until signing of the new budget law, the MT was a flat 1% of the purchase price for transaction involving certain properties. The MT was paid by the buyer. Now, the Mt will be paid by the SELLER and at a much higher rate.
Effective July 10, 2025, New Jersey’s mansion tax has been revised. The tax is now paid by sellers instead of buyers, and it uses a tiered rate structure based on the sale price. The rates are as follows:
This applies to residential, multi-family, certain commercial, farm, and co-op properties. Vacant land is exempt. There are no exemptions for seniors or primary residences.
A rebate is available if the contract was signed before July 10 but closes afterward, and the sale price exceeds $2 million. The rebate covers the amount exceeding the original 1% rate.
This mansion tax is separate from the existing Realty Transfer Fee. The updated tax is projected to generate more than $550 million annually for various state initiatives.
New forms will have to be issued by the NJ Department of the Treasury to reflect the law change. A memo has been released by the Treasury and can be read here.
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Stephen M. Flatow, Counsel
Vested Land Services LLC is a family owned and operated title agency in New Jersey representing Old Republic National Title Insurance Co., CATIC Title Insurance Company, and WFT National Title Insurance Co. We service the residential and commercial real estate markets in New Jersey. Headquartered in Fairfield, New Jersey, the office handles transactions throughout the state. We bring more than 50 years of experience in the title insurance industry and have seen it all. Give us a call.
