Archived 2025 legal update. This article describes the law and information discussed in July 2025. Rates, requirements and personnel may have changed. Review New Jersey Division of Taxation guidance and consult counsel about your transaction.
New Jersey mansion tax changes in 2025
On June 30, 2025, Governor Murphy signed Bill S4666 / A5804 into law, making the seller the responsible party for paying the “Mansion Tax” (N.J.S.A. 46:15-7.2 et seq.), as well as substantially increasing the rates on transfers for more than $2,000,000.00. These changes were effective as of July 10, 2025.
Rather than being imposed on the buyer, the “Mansion Tax” is now imposed on the seller, in addition to the Realty Transfer Fee (N.J.S.A. 46:15-5 et seq.). Although no regulatory guidance or tax forms are yet available, N.J.S.A. 46:15-7.2 now provides the following fee structure for the “Mansion Tax,” which consists of five potential rates, depending on the total amount of consideration stated in the deed:
2025 graduated transfer fee rates
- Consideration of $1,000,000.00 to $2,000,000.00: 1% of the entire consideration
- Consideration of $2,000,000.01 to $2,500,000.00: 2% of the entire consideration
- Consideration of $2,500,000.01 to $3,000,000.00: 2.5% of the entire consideration
- Consideration of $3,000,000.01 to $3,500,000.00: 3% of the entire consideration
- Considerations above $3,500,000.00: 3.5% of the entire consideration
Property classifications and exemptions
As before, the “Mansion Tax” applies to a transfer of real property that has been classified by the municipal tax assessor as Class 2 (1-4 family house), 3A (if the farmland contains a residential dwelling), 4A (commercial), or 4C (a cooperative unit). Conveyances for less than $1,000,000.00 remain exempt from the “Mansion Tax.”
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If you have specific questions pertaining to the information above, please contact one of the attorneys in our Real Estate, Land Use, Planning & Zoning and Environmental Law Department listed below.
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Alice B. Newman anewman@winnebanta.com
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