New York Transfer Tax Explained: State and City Rates for 2026
Transfer taxes are the fees charged when real estate changes hands in New York. Unlike the mansion tax (which buyers pay), transfer taxes in New York are primarily the seller’s responsibility — though the cost ultimately affects both sides of the transaction through pricing negotiations. New York has two layers of transfer tax: the state transfer tax (0.4% on all sales) and the NYC transfer tax (1–1.425% on sales within the five boroughs). Combined, these taxes can reach 1.825% of the sale price on a $1.5 million property, costing the seller $27,375. This guide explains exactly how both taxes work, who pays what, and how rates change at different price thresholds.
New York State Transfer Tax
The state transfer tax applies to all real estate conveyances (sales) in New York State, regardless of location.
| Property Type | Sale Price | State Transfer Tax Rate |
|---|---|---|
| Residential (1-3 family) | Under $3,000,000 | $2.00 per $500 (0.4%) |
| Residential (1-3 family) | $3,000,000 or more | $2.00 per $500 + $1.25 per $500 supplemental (0.65%) |
| All other (commercial, multi-unit) | Any amount | $2.00 per $500 (0.4%) |
The supplemental $1.25 per $500 (0.25%) applies to residential properties of 1-3 units selling for $3 million or more. This was added in 2019 as part of the MTA funding package. It only applies to residential properties — commercial and multi-family properties above 3 units are exempt from the supplemental rate.
NYC Transfer Tax
In addition to the state tax, all sales within New York City are subject to the NYC Real Property Transfer Tax (RPTT). This is a city-level tax with its own rate structure:
| Property Type | Sale Price | NYC Transfer Tax Rate |
|---|---|---|
| Residential (1-3 units) | Under $500,000 | 1.0% |
| Residential (1-3 units) | $500,000 or more | 1.425% |
| All other property | Under $500,000 | 1.425% |
| All other property | $500,000 or more | 2.625% |
Combined Transfer Tax Rates
Here’s what sellers actually pay when you combine state and city transfer taxes:
| Sale Price | State Tax | NYC Tax | Combined Total | Dollar Amount |
|---|---|---|---|---|
| $500,000 | 0.4% | 1.0% | 1.4% | $7,000 |
| $750,000 | 0.4% | 1.425% | 1.825% | $13,688 |
| $1,000,000 | 0.4% | 1.425% | 1.825% | $18,250 |
| $1,500,000 | 0.4% | 1.425% | 1.825% | $27,375 |
| $2,000,000 | 0.4% | 1.425% | 1.825% | $36,500 |
| $3,000,000 | 0.65% | 1.425% | 2.075% | $62,250 |
| $5,000,000 | 0.65% | 1.425% | 2.075% | $103,750 |
Who Pays the Transfer Tax?
By New York custom and standard practice, the seller pays both the state and NYC transfer taxes. This is the default expectation in virtually all residential transactions. However, there are exceptions:
- New construction sponsor sales: In new development condos, the sponsor (developer) often requires the buyer to pay the seller’s transfer taxes. This is negotiated as part of the offering plan and should be clearly stated in the purchase agreement. It effectively increases the buyer’s closing costs by 1.4–2.075%.
- Negotiated transfers: In a buyer’s market, some buyers agree to split or absorb transfer taxes to make their offer more competitive. This is uncommon in standard resales but does happen.
- Co-op sales: Co-op transfers are subject to the same state and city transfer taxes as other property types. The seller typically pays.
Transfer Tax Outside NYC
Outside the five boroughs, only the New York State transfer tax applies. There is no additional county or city transfer tax in most jurisdictions. The rate is a straightforward 0.4% on all sales, with the supplemental 0.25% applying to residential sales of $3 million or more.
| Sale Location | Sale Price | Transfer Tax Rate | Dollar Amount |
|---|---|---|---|
| Westchester County | $1,000,000 | 0.4% | $4,000 |
| Long Island (Nassau) | $750,000 | 0.4% | $3,000 |
| Albany | $400,000 | 0.4% | $1,600 |
| Rochester | $250,000 | 0.4% | $1,000 |
| Westchester County | $3,500,000 | 0.65% | $22,750 |
The significant difference: a $1 million sale in Westchester incurs $4,000 in transfer taxes. The same sale in Manhattan incurs $18,250 — more than four times as much. This cost differential is one factor that buyers and sellers consider when comparing locations. Use our closing cost calculator to estimate total transaction costs in your target area.
Transfer Tax Exemptions
Certain transactions are exempt from New York transfer taxes:
- Transfers to or from the United States, New York State, or any political subdivision (government entities are exempt)
- Transfers by will or intestate succession (inheritance is exempt)
- Transfers to secure or release a debt (mortgage-related transfers)
- Transfers between spouses or between parent and child for $1 or less (nominal consideration family transfers)
- Deeds in lieu of foreclosure
These exemptions are narrow and specific. Standard residential sales — including sales between family members at market value — are fully subject to transfer taxes.
How Transfer Taxes Affect Seller Net Proceeds
For sellers, transfer taxes are a significant line item that reduces net proceeds. Here’s how they stack up alongside other seller costs:
| Seller Cost (on $1.5M NYC Sale) | Amount | % of Sale Price |
|---|---|---|
| Broker Commission (6%) | $90,000 | 6.0% |
| NYC + State Transfer Tax | $27,375 | 1.825% |
| Co-op Flip Tax (if applicable, 2%) | $30,000 | 2.0% |
| Attorney Fees | $4,000 | 0.27% |
| Managing Agent Fee | $750 | 0.05% |
| Total Seller Costs | $152,125 | 10.14% |
Use our seller net proceeds calculator to estimate your take-home amount after all closing costs.
Practical Examples: What Sellers Actually Pay
Let’s walk through several real-world scenarios to show how transfer taxes stack up at different price points and locations across New York State:
Scenario 1: Selling a $750,000 Brooklyn Condo
A seller closing on a two-bedroom condo in Park Slope at $750,000 pays: NYS transfer tax of 0.4% ($3,000) plus NYC transfer tax of 1.425% ($10,688), for a total transfer tax bill of $13,688. Add this to the broker commission of $45,000 (6%) and attorney fees of $3,500, and the seller’s total closing costs reach approximately $62,188 — or 8.3% of the sale price. That leaves the seller with about $687,812 before paying off their mortgage.
Scenario 2: Selling a $400,000 Home in Rochester
A seller closing on a Colonial in Brighton at $400,000 pays only the NYS transfer tax: 0.4% ($1,600). There’s no city transfer tax outside NYC. Combined with a 5.5% broker commission ($22,000) and attorney fees ($2,500), total seller closing costs are approximately $26,100 — about 6.5% of the sale price. The dramatically lower transaction costs outside NYC are one reason upstate home sales retain more of the seller’s equity.
Scenario 3: Selling a $3.5 Million Manhattan Apartment
At $3.5 million, the supplemental state transfer tax kicks in. The seller pays: NYS transfer tax of 0.4% ($14,000) plus the supplemental tax of 0.25% ($8,750) plus NYC transfer tax of 1.425% ($49,875), totaling $72,625 in transfer taxes alone. With a 5% broker commission ($175,000) and attorney fees ($5,000), the seller’s total costs exceed $252,625 — about 7.2% of the sale price. The progressive nature of the combined taxes creates a meaningful additional burden at the $3 million threshold.
How Transfer Taxes Affect Pricing Strategy
Smart sellers account for transfer taxes when setting their asking price. The $500,000 threshold in NYC (where the city rate jumps from 1% to 1.425%) creates a minor pricing consideration. More significantly, the $3 million threshold (where the state supplemental tax adds 0.25%) affects luxury pricing decisions. A seller netting the same amount from a $2.95 million sale versus a $3.05 million sale needs to price about $15,000 higher at $3.05M to account for the additional transfer taxes. Some listing agents deliberately price just below these thresholds.
Buyers should also be aware of how transfer taxes affect the seller’s net proceeds, especially in negotiations. A seller who has already calculated their net proceeds at a given price will resist price reductions more firmly because each dollar of reduction comes on top of the fixed percentage costs. Understanding the seller’s cost structure gives buyers leverage in negotiations.
Transfer Taxes on New Construction
New construction condo sales from developers (sponsors) involve a special wrinkle: sponsors frequently shift their transfer tax obligation to the buyer through the offering plan. This is legal and common in NYC. When the sponsor requires the buyer to pay both the buyer’s mansion tax AND the seller’s transfer taxes, the buyer’s total closing costs can reach 6–8% of the purchase price. Always read the offering plan carefully and factor sponsor transfer tax requirements into your purchase budget. Some sponsors offer credits or incentives that offset this cost, particularly in slower market periods. Use our closing cost calculator to model new construction scenarios.
Transfer Taxes in a 1031 Exchange
Investors using a 1031 exchange (like-kind exchange) to defer capital gains taxes on investment property sales should know that transfer taxes still apply to 1031 transactions. The sale of the relinquished property triggers the same state and city transfer taxes as any other sale. The purchase of the replacement property triggers the buyer’s closing costs, including mansion tax if applicable. The 1031 exchange defers income taxes, not transfer taxes.
For NYC investment property owners, the combined transfer taxes (1.825% on a $1M+ sale) plus broker commission (5–6%) plus capital gains deferral make 1031 exchanges a popular strategy. The key deadlines — 45 days to identify replacement properties and 180 days to close — create urgency that can affect pricing decisions on both the sale and purchase sides.
Transfer Taxes on Estate and Inheritance Transfers
When property transfers through an estate (after the owner’s death), the transfer may be exempt from New York transfer taxes if the property passes to heirs without a sale. However, if the estate sells the property, standard transfer taxes apply to the sale. The estate pays the seller’s transfer taxes from the sale proceeds before distributing to heirs.
For co-op apartments, the transfer of shares to a surviving spouse or family member through succession rights (common in rent-stabilized co-ops) may not trigger transfer taxes because no sale occurs. Use our rent affordability calculator for detailed numbers. However, if the shares are sold to a third party by the estate, standard transfer taxes apply. Estate planning for New York real estate should account for both transfer taxes on any potential sale and the state’s separate estate tax (with an exemption threshold of approximately $6.94 million in 2026). Consult an estate attorney for strategies that minimize both transfer and estate tax exposure.
Transfer Tax Filing and Payment
Transfer taxes are filed and paid at closing through the TP-584 form (New York State Real Property Transfer Tax Return) and, within NYC, the RPT form (NYC Real Property Transfer Tax Return). The seller’s attorney typically prepares and files these forms. Payment is due at closing and is collected along with all other closing funds. The title company or closing attorney submits the payment to the appropriate taxing authority within 15 days of closing. Late payments trigger penalties of 5% per month, up to 25%, plus interest. For sellers, these taxes are deducted from the sale proceeds — you don’t write a separate check. Your attorney should include a line item for transfer taxes in the closing statement, and you should verify the calculation matches the rates for your property type and sale price before signing closing documents.
Transfer Tax vs. Mansion Tax: Key Differences
| Feature | Transfer Tax | Mansion Tax |
|---|---|---|
| Who pays | Seller | Buyer |
| Threshold | $0 (applies to all sales) | $1,000,000 |
| Rate structure | Flat rates with thresholds | Progressive brackets |
| NYC-specific rates | Yes (1.0–1.425%) | Yes (1–3.9%) |
| Applies to co-ops | Yes | Yes |
For a complete breakdown of all closing costs in NYC, see our closing costs explainer. Use our mortgage calculator to model your purchase scenario.
Compare With Other States
Considering other markets? Here’s how other states compare:
- Pennsylvania Transfer Tax Explained: What Buyers and Sellers Pay
- Oregon Real Estate Transfer Tax Explained: What Buyers and Sellers Pay
- California Transfer Tax Explained: What Buyers and Sellers Pay
Frequently Asked Questions
How much is the transfer tax in New York?
New York State charges 0.4% on all real estate sales (0.65% on residential sales of $3M+). NYC adds 1% on residential sales under $500,000 and 1.425% on sales of $500,000 or more. Combined, a $1 million NYC sale incurs 1.825% in transfer taxes ($18,250). Outside NYC, only the state tax applies (0.4% = $4,000 on a $1M sale).
Does the buyer or seller pay transfer tax in New York?
The seller pays transfer taxes in standard residential transactions. The one major exception is new construction sponsor sales, where developers often contractually require the buyer to pay the seller’s transfer taxes. In resale transactions, seller payment is the strong default, though negotiation is technically possible.
Is there a transfer tax on co-op sales?
Yes. Co-op share transfers are subject to the same state and city transfer taxes as other property sales. The taxable amount is the consideration paid for the shares, including any assumption of the underlying mortgage allocated to the unit.
How does the $500,000 threshold affect NYC transfer tax?
For residential sales under $500,000, the NYC transfer tax is 1%. At $500,000 and above, it jumps to 1.425%. This creates a minor price cliff similar to the mansion tax’s $1 million threshold, though the 0.425% difference is less dramatic. On a $500,000 sale, the rate increase adds $2,125 to the seller’s cost.
Can transfer tax be avoided?
For standard sales, no. Transfer taxes are required by law and collected at closing by the title company or attorney. The only exceptions are for specific exempt transactions (inheritance, government transfers, certain family transfers at nominal consideration). Gift transfers may avoid transfer tax but trigger gift tax implications. Consult a real estate attorney about your specific situation. Use our affordability calculator to factor all transaction costs into your purchase planning.