Selling a New Jersey Property Over $1 Million: Graduated Percent Fee Explained

*Last reviewed: September 14, 2026*

If you bought a high-value home in New Jersey years ago, you probably remember paying the so-called "mansion tax" at closing — a flat 1% fee on transactions over $1 million.

If you are planning to sell that home today, you might assume the new buyer will pay that tax again.

You would be wrong. And it could cost you tens of thousands of dollars.

Effective July 10, 2025, New Jersey fundamentally changed its supplemental Realty Transfer Fee — now officially called the Graduated Percent Fee, sometimes informally called the mansion tax. The state legislature not only shifted the entire burden of this tax from the buyer to the seller, but also changed it from a flat rate to a graduated structure that hits higher-value properties much harder.

If you are listing a New Jersey property for more than $1 million, this is now a major line item on your side of the closing statement.

The Shift: Buyers Are Out, Sellers Are In

For decades, the rule was simple: if the purchase price exceeded $1,000,000, the buyer paid an extra 1% of the entire consideration to the State. Sellers didn't worry about it.

That era is over. The Graduated Percent Fee is now the seller's statutory responsibility.

If your real estate agent hasn't mentioned this yet, you need to adjust your net-proceeds calculations immediately.

The Official Five-Tier Schedule

The rate applies to the entire consideration within the applicable tier — not just the amount above the threshold. This is not a progressive marginal tax.

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Examples using the official schedule:

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The "Cliff" Effect

Because the rate applies to total consideration, crossing a threshold can materially change the fee. The exact statutory endpoint and closing calculation should be confirmed for the deed-recording date.

A seller closing at $2,000,000 owes 1% on the entire $2,000,000 ($20,000). A seller closing at $2,100,000 owes 2% on the entire $2,100,000 ($42,000). That extra $100,000 in sale price costs an additional $22,000 in fee.

Sellers and their agents need to be acutely aware of these thresholds during negotiations. A small increase in the sale price that pushes you over a new tier could actually net you less money after taxes.

Important Notes

• Deeds submitted for recording on or after July 10, 2025 are subject to the current Graduated Percent Fee framework, subject to applicable property classifications, exemptions, and filing requirements.
• The Graduated Percent Fee is supplemental to the ordinary Realty Transfer Fee, which remains a separate charge.
• The seller is statutorily responsible for the Graduated Percent Fee.
• Exemptions and filing requirements must be checked separately.

Official source: NJ Division of Taxation — Realty Transfer Fee | NJ Graduated Percent Fee Notice

Calculate Your True Net Proceeds Early

Don't wait until the week before closing to see the preliminary Closing Disclosure and go into shock.

If you are selling property in New Jersey above $1 million, you need accurate numbers before you list. Contact my office to run the projections so you know exactly what you are walking away with.

*This article provides general educational information and is not legal, tax, accounting, lending, or financial advice. Tax rates, exemptions, filing requirements, and closing practices may depend on the property, transaction structure, applicable law, and closing date. Confirm the current calculation with the appropriate attorney, lender, title company, closing agent, or tax professional.*