One dollar over,
one bracket up
The mansion tax is a buyer-paid transfer tax that starts at $1 million and steps through eight brackets. Near a threshold, a small price move changes the tax by tens of thousands.
Before you read on
- Rates as of August 2026 for New York City residential purchases; verify current schedules before contract.
- This is general information, not tax advice.
- The planning content is in Section 3 — thresholds reward precise pricing.
Point 1How the tax works
A one-time, buyer-paid tax on the full purchase price, due at closing.
New York State imposes a 1% tax on residential purchases of $1 million or more. For New York City purchases, a 2019 supplemental schedule stacks additional rates that rise with price — combined, the brackets run from 1% just above $1 million to 3.9% at $25 million and above.
Two mechanics matter. The tax applies to the entire price, not the amount above the threshold: a $2,000,000 purchase pays 1.25% on all $2 million. And it is the buyer's obligation, on top of every other closing cost — it does not replace transfer taxes the seller pays.
Point 2The brackets
Read the first and second rows together: at $1,999,999 the tax is $20,000; at $2,000,000 it is $25,000. One dollar of price moved the tax by $5,000. At the $5 million and $10 million lines the jumps are far larger.
| Purchase price | Combined rate |
|---|---|
| $1,000,000 – 1,999,999 | 1.00% |
| $2,000,000 – 2,999,999 | 1.25% |
| $3,000,000 – 4,999,999 | 1.50% |
| $5,000,000 – 9,999,999 | 2.25% |
| $10,000,000 – 14,999,999 | 3.25% |
| $15,000,000 – 19,999,999 | 3.50% |
| $20,000,000 – 24,999,999 | 3.75% |
| $25,000,000 and above | 3.90% |
NYC residential schedule. The rate applies to the full price once a threshold is crossed.
Point 3Pricing around a threshold
Sellers price against the brackets whether they say so or not — which is why listings cluster at $1,995,000 and $4,995,000. As a buyer, a negotiation that crosses a threshold downward is worth more than its face amount: moving a $5,050,000 deal to $4,999,999 saves the 0.75% bracket difference on the entire price, roughly $37,500 of tax on top of the $50,001 price cut.
What does not work is disguising price. Splitting consideration into a sham furniture bill or side agreement to duck a bracket is tax evasion, and the city's transfer records are audited against exactly this pattern. Price honestly; negotiate the real number against the bracket.
Point 4Where it fits in the closing stack
On a $3 million condo purchase with financing, the mansion tax (1.5% = $45,000) is typically the largest single closing cost, ahead of the mortgage recording tax and title insurance. Cash purchases avoid the recording tax but never the mansion tax — it attaches to the deed, not the loan.
Budget it from the first offer model. A buyer stretching to a price without modelling the bracket can find the required cash at closing tens of thousands higher than the down payment math suggested.
The buyer, at closing, on the full purchase price. It is separate from the transfer taxes the seller customarily pays — except in sponsor sales, where transfer taxes often shift to the buyer as well.
No. Once the price crosses a threshold, the bracket's rate applies to the entire price, which is why prices cluster just under the break points.
The 1% state tax applies statewide at $1 million and above. The supplemental brackets above 1% apply to New York City purchases.
Genuine, reasonably valued personal property can be allocated, but sham allocations to duck a bracket are evasion and transfer records are audited for the pattern. Any allocation should be defensible and papered by your attorney.
Yes — residential purchases generally, including co-op shares, condos, townhouses, and most mixed-use with residential character.
Not as a current expense. It forms part of your cost basis, which matters at sale for capital gains. Confirm treatment with your tax adviser.
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Important notice
The figures on this page are general information as of August 2026 and do not represent an offer, a quote, or a guarantee of any transaction terms. Reinvent NY does not provide legal, tax, or investment advice. Confirm anything material with an attorney and a CPA before you act on it. Nothing here is a solicitation to invest, and no return is promised. Real estate brokerage services are provided through R New York.