New Jersey’s Realty Transfer Fee and the fee commonly called the “mansion tax” are separate charges. The regular Realty Transfer Fee generally applies when a deed transfers property for consideration, unless an exemption applies. The former mansion tax is now a Graduated Percent Fee, which adds 1% to 3.5% of the entire consideration on certain transfers over $1 million. The seller is statutorily responsible for both. See New Jersey’s current transfer fee guidance.
For sellers, the practical question is whether your closing estimate includes both charges when applicable. Here is how to distinguish them and prepare for the conversation with your closing team.
What is the New Jersey Realty Transfer Fee?
The Realty Transfer Fee, or RTF, is a state charge associated with recording a deed. It is generally based on the consideration stated in the deed. For a straightforward sale, that usually means the purchase price, but some transfers require a different valuation analysis.
The regular RTF uses a schedule of charges per $500 of consideration or fractional part. It is not a single flat percentage. The applicable schedule depends on the transaction, including whether a qualifying exemption or reduced rate applies. Review the state’s RTF overview and rate schedules.
When reviewing an estimate, ask your closing team to identify the regular RTF separately from any Graduated Percent Fee. Keeping those figures distinct makes it easier to understand what you are being charged.
Is New Jersey’s mansion tax still 1%?
Not for every covered transaction. The law changed effective July 10, 2025: the additional fee shifted from the buyer to the seller, and higher rates were introduced for transfers above $2 million.
Under the current structure, the applicable rate is determined by the total consideration and applies to that entire amount. It does not apply only to the dollars above $1 million, and it is not calculated like marginal income tax brackets. Read the Division of Taxation’s announcement.
What are the current NJ Graduated Percent Fee rates?
For a covered transfer with no applicable exemption:
Graduated Percent Fee rates
- $1 million or less: no Graduated Percent Fee.
- More than $1 million through $2 million: 1% of the entire consideration.
- More than $2 million through $2.5 million: 2% of the entire consideration.
- More than $2.5 million through $3 million: 2.5% of the entire consideration.
- More than $3 million through $3.5 million: 3% of the entire consideration.
- More than $3.5 million: 3.5% of the entire consideration.
These thresholds come from P.L. 2025, Chapter 69. Exactly $2 million remains in the 1% band; a covered transfer above $2 million enters the 2% band.
That change can materially affect estimated sale proceeds. Ask for an updated fee calculation whenever the agreed consideration changes, especially near a threshold.
What could the two fees look like at closing?
The examples below assume an ordinary residential sale, consideration equal to the sale price, the standard RTF schedule, no exemptions, and application of the Graduated Percent Fee where the price exceeds $1 million.
Illustrative transfer fees
$750,000 sale: regular RTF of $6,775 plus no Graduated Percent Fee, for combined transfer fees of $6,775.
$1.2 million sale: regular RTF of $11,995 plus a Graduated Percent Fee of $12,000, for combined transfer fees of $23,995.
$2.75 million sale: regular RTF of $30,750 plus a Graduated Percent Fee of $68,750, for combined transfer fees of $99,500.
Retain the article’s assumptions, source links, and explanation that these totals exclude other closing costs.These are illustrative calculations using the state’s standard RTF schedule and Graduated Percent Fee rates. The combined column includes only these two transfer charges. It is not a complete closing-cost estimate and excludes items such as mortgage payoffs, commissions, title charges, recording charges, and adjustments.
Who pays: the buyer or the seller?
The seller, also called the grantor, has statutory responsibility for the regular RTF and the Graduated Percent Fee. However, the parties may negotiate a different allocation of the cost in their contract.
The Division of Taxation distinguishes legal responsibility to the state from a private agreement about who supplies payment. Have your attorney review any contract provision allocating transfer fees, rather than relying on the phrase “buyer pays mansion tax” in an older guide. See the state’s implementation clarification.
Does the additional fee apply to every property over $1 million?
No. Property classification and exemptions matter. Covered categories include Class 2 residential property, certain Class 3A farm property with a residential structure, Class 4A commercial property, and qualifying cooperative units. Do not assume that every property marketed as “commercial” receives the same treatment. Review the state’s applicability and exemption guidance.
Mixed-use properties deserve particular attention. Updated state guidance following an April 2026 Tax Court decision calls for a predominant-use analysis that considers both square footage and income. The guidance also provides a pre-closing classification review process and recommends submitting reclassification claims at least 45 days before closing. Read the updated mixed-use property guidance.
If your property combines storefronts, apartments, or industrial space, raise the classification question early with your attorney and title team.
Are any exemptions or reduced fees available?
Some transfers qualify for a full RTF exemption, while qualifying senior citizens, blind or disabled persons, and certain low- and moderate-income housing transfers may receive partial-exemption treatment. Eligibility and documentation must be checked for the specific transaction.
The Graduated Percent Fee has its own applicability and exemption rules. A reduced regular RTF does not, by itself, establish that the additional fee disappears. The state’s RTF-1EE affidavit and instructions address property classes and exemption claims for the additional fee. Ask your closing team which forms and supporting records your transfer requires.
What should sellers confirm before closing?
Bring these questions to your attorney or settlement team:
What consideration is being used to calculate the fees?
Is the property classification confirmed, including any mixed-use issues?
Does the estimate show the regular RTF and Graduated Percent Fee separately?
Is an exemption or reduced schedule available, and what documentation supports it?
Does the contract allocate payment differently from the statutory responsibility?
Has the estimate been updated for the final price and transaction details?
Use an early estimate to plan, then request a transaction-specific review before relying on the figure for your expected proceeds.
Frequently asked questions
Is there a mansion tax on a sale for exactly $1 million?
The Graduated Percent Fee begins when consideration exceeds $1 million. A transfer at exactly $1 million does not trigger that fee, although the regular RTF may still apply.
Does the Graduated Percent Fee replace the regular transfer fee?
No. It is an additional charge on covered transactions. Budget for both unless your closing team confirms an exemption or other applicable treatment.
Is the fee based on my profit or equity?
The Graduated Percent Fee is based on the transfer’s total consideration, rather than the seller’s profit or equity. An outstanding mortgage does not turn the calculation into a tax on net proceeds. See the statutory calculation.
Where can I estimate my New Jersey transfer fees?
Start with Title Evolution’s New Jersey Realty Transfer Fee Calculator, then have your title team confirm the calculation, property classification, and exemption treatment for your transaction.
Get a clearer picture of your closing costs
Title Evolution supports residential and commercial title and settlement transactions throughout New Jersey and Eastern Pennsylvania. If you are preparing to sell, we can help you understand the title and settlement details for your closing.
Request a quote or contact our team. You can also find forms on our New Jersey resources page.
This article provides general educational information based on official sources checked October 29, 2026. It is not legal or tax advice. Fees, exemptions, property classifications, and contractual obligations depend on the transaction; confirm their application with your attorney, tax adviser, and closing team.