What Is the Mansion Tax in New York?
New York’s mansion tax kicks in at $1 million statewide, but if you’re buying in New York City, additional tiers push the rate higher on purchases of $2 million or more. The buyer usually pays it.
What Is the Mansion Tax in New York?
The mansion tax is a one-time tax paid when you buy residential property in New York for $1 million or more. It’s a transaction tax, charged at closing, not an annual tax on owning the home. Despite the name, the property doesn’t need to be a literal mansion. A one-bedroom condo that happens to cost $1.1 million is subject to it just the same as a townhouse.
This isn’t a local NYC permit it’s a state-level registration that applies across New York, but it’s what every NYC business selling taxable goods or services needs to operate legally within the five boroughs. You need one whether you’re running a retail shop in Manhattan, a restaurant in Brooklyn, an online store shipping to NYC customers, or most service businesses that sell taxable items.
Without it, you can’t legally collect sales tax and if you’re supposed to be collecting it and aren’t, you’re still on the hook for what you should have collected, plus penalties and interest. The state doesn’t care whether you knew the rule or not.
New York State vs. New York City Mansion Tax
New York State charges a flat 1% mansion tax on qualifying residential purchases of $1 million or more, anywhere in the state. New York City adds its own supplemental tax on top of that, with rates that climb in steps starting at $2 million. So a Brooklyn condo and a house upstate both start with the same 1% state tax; the city simply layers more on for higher-priced NYC purchases.
Mansion Tax NYC Calculator
Enter the purchase price and choose the location to see an estimated mansion tax. Full rate table and formula are below.
Estimate only, for a standard fully residential purchase. Not total closing costs — other fees and taxes aren't included. Mixed-use properties, unusual transfers, or negotiated consideration adjustments may change the result; talk to a professional for those.
How Much Is the Mansion Tax in New York?
Outside NYC, the statewide mansion tax is a flat 1% on qualifying residential purchases of $1 million or more. Inside NYC, use the combined rate below — it already includes the 1% state tax, so don’t add another 1% on top of it.
| Purchase price | Combined NYC mansion tax rate |
|---|---|
| Below $1 million | 0% |
| $1 million to below $2 million | 1.00% |
| $2 million to below $3 million | 1.25% |
| $3 million to below $5 million | 1.50% |
| $5 million to below $10 million | 2.25% |
| $10 million to below $15 million | 3.25% |
| $15 million to below $20 million | 3.50% |
| $20 million to below $25 million | 3.75% |
| $25 million or more | 3.90% |
Does the Rate Apply to the Entire Purchase Price?
Yes, the applicable rate applies to the whole purchase price, not just the amount above the threshold. A $2 million NYC purchase is taxed at 1.25% on the full $2 million, which is $25,000. That’s different from income tax brackets, where only the income within each bracket gets taxed at that bracket’s rate. Mansion tax doesn’t work that way: once you cross into a bracket, the whole price is taxed at that bracket’s rate.
Who Pays Mansion Tax in NY?
The buyer is legally responsible for the mansion tax. It’s separate from the seller’s transfer tax obligation. That said, buyer and seller can negotiate a seller credit or concession that effectively covers some or all of the cost that’s a private deal term, not a change in who’s legally on the hook. If the buyer doesn’t pay, New York State can hold the seller liable for it, so sellers have a real interest in confirming it gets paid at closing.
Which Properties Are Subject to Mansion Tax?
The mansion tax in New York applies to qualifying residential real property: single-family and multi-family houses, condos, and co-ops, when the purchase price hits $1 million or more. Mixed-use buildings (residential over retail, for example) and unusual transfers, like partial interests or entity transfers, don’t fit neatly into the standard rule and should be reviewed individually rather than assumed one way or the other.
New York Mansion Tax Calculation Examples
- $1,000,000 purchase in NYC — hits the 1.00% tier: $1,000,000 × 1% = $10,000.
- $2,000,000 purchase in NYC — hits the 1.25% tier: $2,000,000 × 1.25% = $25,000.
- $2,000,000 purchase elsewhere in NY State — flat statewide 1%: $2,000,000 × 1% = $20,000. No NYC supplemental tax applies outside the city.
When and How Is Mansion Tax Paid?
Mansion tax gets arranged as part of closing; your attorney or title company typically handles the paperwork and payment alongside the deed transfer. The forms differ by location: Form TP-584 is used outside NYC, and Form TP-584-NYC is used for NYC transactions. Separately, state guidance sets the statutory filing deadline generally within 15 days after delivery of the relevant document, but in practice, payment is coordinated and submitted at closing rather than left until that deadline.
Are There Mansion Tax Exemptions or Ways to Reduce the Cost?
Genuine statutory exemptions are narrow and situation-specific check current guidance before assuming one applies to you. What’s more common: negotiating a lower purchase price, or getting a seller contribution toward the buyer’s costs at closing. Neither of these is a “mansion tax exemption” in the legal sense a seller credit doesn’t reduce the taxable consideration used to calculate the tax; it just changes who’s effectively paying for what.
Mansion Tax vs. Other New York Closing Costs
| Cost | Who typically pays | When |
|---|---|---|
| Mansion tax | Buyer | At closing, one time |
| NY State/NYC transfer tax | Seller | At closing, one time |
| Mortgage recording tax | Buyer (if financing) | At closing, one time |
| Property tax | Owner | Recurring, annually |
Buying property in New York and want to know your real closing costs?
Get your mansion tax and closing costs reviewed before you sign.
Frequently Asked Questions
Yes. The threshold is inclusive, so a $1,000,000 purchase is taxed, not exempt. At $1 million in NYC, that's $10,000 (1.00% combined rate); outside NYC, it's the same $10,000 at the flat 1% statewide rate.
The full purchase price, once you're in a taxable bracket. Unlike income tax brackets, there's no "only the excess" calculation the whole price gets multiplied by the applicable rate.
No. It's a one-time tax paid when you buy the property, not a recurring cost like property tax. You won't see it again unless you buy another qualifying property.
Yes. Houses, condos, and co-ops that meet the residential and price criteria are all covered. Mixed-use or unusual ownership structures may need individual review.
There's no general first-time buyer exemption under current New York guidance. Any exemption that does apply is narrow and fact-specific — confirm against current official guidance rather than assuming.
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The buyer is statutorily responsible, but sellers can agree to a credit or concession that covers some or all of it as part of negotiations. That's a deal term, not a change to who's legally liable if it goes unpaid.
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No. Mansion tax is based on the purchase price, not on financing. It applies whether you pay cash or take out a mortgage — mortgage recording tax is the separate, financing-related charge.
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Yes, the statewide 1% rule applies anywhere in New York State for purchases of $1 million or more. Only NYC has the additional supplemental tiers above $2 million — Long Island and Westchester purchases stay at the flat 1%.
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No. Mansion tax is a one-time transaction tax paid by the buyer at closing. Property tax is a recurring annual tax paid by whoever owns the property, based on assessed value.
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It's built for standard, fully residential purchases and gives a solid estimate for those. Mixed-use properties, unusual transfers, or negotiated consideration adjustments can change the actual amount — those situations are worth a professional review.
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