NJ Mansion Tax: What Sellers Now Owe Over $1 Million

Know every fee before you close. The number you hear should be the number you keep. That principle matters more right now than it has in years, because the NJ mansion tax changed completely on July 10, 2025. It used to be a buyer-paid 1% flat fee on any home over $1 million. Under P.L.2025, c.69, it is now a seller-paid graduated fee with five tiers and hard pricing cliffs that can cost you $20,000 if you sign a contract without reading this first. Most sites still show the old buyer-pays framing. This article has the current law, the math, and plain advice for South Jersey sellers across Camden, Gloucester, Burlington, Atlantic, Cumberland, Salem, Cape May, and Ocean counties.

Calculate the mansion tax and transfer fee on your sale

Old Mansion Tax vs. New Law: Side by Side

The Five Rate Tiers and Where the Cliffs Are

NJ's graduated fee has five hard tiers; crossing from $2M to $2,000,001 doubles the entire bill from $20,000 to $40,000.02.

The law applies one rate to the entire sale price, not just the amount above each threshold. That is what creates cliffs. Here are the five tiers under N.J.S.A. 46:15-7.2 as amended by P.L.2025, c.69: 1% for sales over $1M up to $2M, 2% for sales over $2M up to $2.5M, 2.5% for sales over $2.5M up to $3M, 3% for sales over $3M up to $3.5M, and 3.5% for sales over $3.5M. Watch the tier boundaries closely. At exactly $2,000,000 you owe $20,000. At $2,000,001 you owe $40,000.02. That is a $20,000 jump for one dollar of price. The same cliff hits at $2.5M, $3M, and $3.5M. If your list price lands near any of those numbers, talk to your attorney before you accept an offer. Pricing at $1,999,000 instead of $2,050,000 might put more money in your pocket even though the sale price is lower.

What Properties Are Covered, and What Is Exempt

The graduated fee covers Class 2 residential (1-4 units), co-ops, Class 3A farms with a house, and Class 4A commercial, vacant land is exempt.

The graduated fee applies to Class 2 residential property (one to four units), co-op units, Class 3A farms that include a residential structure, and Class 4A commercial property. Class 1 vacant land is explicitly exempt. So if you are selling a single-family home, a duplex, a triplex, a four-unit building, or a farm with a house on it in Camden County or anywhere else in our service area, this law applies to you the moment the price clears $1 million. Sellers who qualify for the reduced realty transfer fee rate, seniors 62 and older, blind sellers, or permanently and totally disabled sellers under N.J.S.A. 46:15-10, still owe the graduated fee in full. The reduced RTF rate does not carry over to this separate charge. Those are two different fees. That distinction trips up a lot of sellers in South Jersey retirement communities.

Can the Contract Shift Who Pays?

NJ law defaults the graduated fee to the seller, but a purchase contract can reassign it to the buyer, always confirm in writing before signing.

By law, you as the seller owe the graduated fee. The statute does let the purchase contract shift that obligation to the buyer, though. That shift matters most in commercial deals and luxury residential sales where both sides negotiate every line. In a standard South Jersey residential transaction, the contract will almost never move this charge off your plate. Assume you are paying it unless your attorney has confirmed otherwise in the actual contract language, not in a verbal assurance. We will concede the old rule was simpler for sellers. Under the flat 1% buyer fee, a seller pricing near $2 million barely had to think about it. Now a $2,000,001 sale costs you $40,000.02 in graduated fees versus $20,000 at exactly $2,000,000, so the last few thousand dollars of price matter more than they used to. Get the contract language in writing.

South Jersey Reality: Most Sellers Here Never Owe It

Median South Jersey home prices in Camden, Gloucester, and Burlington counties sit well below $1M, so the graduated fee rarely applies to local sellers.

Let's be straight with you. If you are selling a home in Gloucester City, Woodbury, Vineland, Bridgeton, Millville, Egg Harbor Township, Mays Landing, or most towns across our eight-county footprint, your sale price is almost certainly below $1 million. The graduated fee does not apply to you. Your closing costs still include the standard realty transfer fee, the NJ exit tax if you are a nonresident, and other charges you can review in our full breakdown of NJ seller closing costs. That page covers every line item in one place. The mansion tax only becomes real for sellers in the higher-end pockets of the Shore, Cherry Hill's premium blocks, or certain Burlington County estates. If that is your situation, the math above matters a great deal. For everyone else, knowing the $1 million threshold protects you from paying for advice you simply do not need.

Inherited Homes, Divorce, and Other Complex Situations

Inherited or divorce-related sales over $1M owe the graduated fee in full, stepped-up basis or equitable distribution orders do not waive the transfer charge.

If you inherited a house worth more than $1 million, the graduated fee applies at closing. It does not matter what your cost basis is or how the estate is set up. The stepped-up basis rules under IRC § 1014 may wipe out your capital gains tax, but they do nothing to reduce the transfer fee. The same is true in divorce. If a decree orders a sale and the home clears $1 million, the seller named at closing owes the fee. For more on how inherited property sales work in New Jersey, read our guide to selling an inherited house in NJ. If divorce is pushing the sale, our page on taxes when selling a marital home in NJ walks through the full cost picture. In either situation, get your attorney and your CPA on the same call before you set a price.

Selling Fast in South Jersey When Cost Certainty Matters

A cash sale to Elite Home Buyers closes with no agent commissions, no repair costs, and a clear fee picture before you sign anything.

Knowing your closing costs to the dollar before you sign lets you make a real decision. That is exactly what we aim for at Elite Home Buyers. We have been buying homes across South Jersey since 2018, we carry a BBB A+ rating, and we make a real cash offer within 24 hours. We charge no fees, ever. When the paperwork is clean, seven days from offer to closing is realistic. For sellers above $1 million, we walk you through the graduated fee in the first conversation, because that number directly changes what you take home. For sellers below $1 million, which covers most of our market, the mansion tax is not a factor, and we tell you that plainly. Every fee is on the table before you close, so the number you hear is the number you keep. That is the standard we hold ourselves to on every deal. Clean paperwork means you can be done in seven days.

Get a Cash Offer With No Surprise Fees

We show every cost on your net sheet upfront, no commissions, repair demands, or closing fees, with a real cash offer in 24 hours.

Know every fee before closing, so the number you hear is the number you keep. We show you every cost on your net sheet before you sign anything. No commissions, no repair demands, no closing fees from our side. We have been buying South Jersey homes since 2018 with a BBB A+ rating and a real cash offer in 24 hours. If your home is above or below the million-dollar threshold, we will tell you exactly where you stand.