Alert: Increased New York Transfer Tax and Mansion Tax effective July 1

By admin

The 2020 NY Budget Bill included the following two provisions that will increase the Real Property Transfer Tax in some circumstances:

• Amendments to Section 1402 of the Tax Law, resulting in an Increase of New York Transfer Tax
• Addition of a new section to the Tax Law, Section 1402-B, which imposes a new Supplemental “Mansion Tax” on residential real property

Where?

The Increase of Transfer Tax and Supplemental “Mansion Tax” will only apply to real property located in any city in New York having a population of one million or more. Currently, these changes would only apply to the five boroughs of New York City.

When?

Both the Increase of New York Transfer Tax and the Supplemental Mansion Tax will apply to all closings that take place on or after July 1, 2019.

They WILL NOT apply to conveyances made pursuant to binding written contracts entered into on or before April 1, 2019, even if they close after July 1.

To pay current rates, parties must provide the Commissioner of Taxation and Finance buy dapoxetine 60mg UK with independent evidence as to the date of execution of the contract, such as the recording of the contract or the payment of the contract deposit.

The Details

Increase of New York Transfer Tax

The New York State Transfer Tax rate will remain unchanged at 0.4% of the purchase price for:

• Residential properties with a purchase price under $3m
• Non-residential properties with a purchase price under $2m

The New York State Transfer Tax rate will increase to 0.65% of the purchase price for:

• Residential properties with a purchase price of $3m or greater
• Non-residential properties with a purchase price of $2m or greater

The existing New York City Transfer Tax will stay the same. Increases are reflected in the Supplemental “Mansion Tax” described below.

Supplemental “Mansion Tax”

The existing “Mansion Tax” is calculated as 1% of the purchase price for properties of $1M or more. Under the newly passed budget, the “Mansion Tax” rate will increase along with the purchase price of the property:

• $1m-$2m – 1% of purchase price (unchanged)
• $2m-$3m – 1.25% of purchase price
• $3m-$5m – 1.5% of purchase price
• $5m-10m – 2.25% of purchase price
• $10m-$15m – 3.25% of purchase price
• $15m-$20m – 3.5% of purchase price
• $20m-$25m – 3.75% of purchase price
• $25m and up – 3.9% of purchase price

Now that it is getting even more expensive to own in an already pricey New York real estate market, your clients might look to purchase in another state. Please let them know that World Wide Land Transfer can handle title all over.

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World Wide Land Transfer is a service-oriented NY title agency with offices in New York, Philadelphia and Washington, D.C. that is trusted to close everything from complex, multi-state commercial transactions to the basic residential refinance or purchase transactions.

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