The NYC mansion tax is 1% of the full price when a home sells for $1,000,000 or more, and the buyer pays it. City sales at $2M and up owe a supplemental tax on top, so the buyer’s rate climbs from 1.25% to 3.9%.
From January through August 2026, 46.7% of recorded Madison sales crossed $1M. So did 41.8% in Midwood and 15.3% in Marine Park.
How much is the mansion tax in NYC
It’s 1% of the purchase price, and it gets added to buyer closing costs. The state charges it under the real estate transfer tax part of its Tax Law and calls it the additional tax.
Since July 1, 2019, residential sales within the five boroughs at $2 million or more also owe a supplemental tax. Its tax rate rises with the price bracket, so the buyer’s total rate climbs too.
New York mansion tax rates by price bracket
This table adds the state tax and the city supplemental tax together.
| Sale price | Buyer’s combined rate | Tax at the bottom of the range |
|---|---|---|
| $1M to $2M | 1% | $10,000 |
| $2M to $3M | 1.25% | $25,000 |
| $3M to $5M | 1.5% | $45,000 |
| $5M to $10M | 2.25% | $112,500 |
| $10M to $15M | 3.25% | $325,000 |
| $15M to $20M | 3.5% | $525,000 |
| $20M to $25M | 3.75% | $750,000 |
| $25M and up | 3.9% | $975,000 |
Sources: NYS Department of Taxation and Finance, Real estate transfer tax and Form TP-584-NYC-I. Each range runs up to one dollar short of the next.
One rate covers the whole price. The tax bracket a sale lands in sets the rate, and that rate is multiplied by the full amount. The state’s own example is a $5M two-family house, which owes the supplemental tax at 1.25%. Add the 1% and that buyer pays $112,500.
Who pays the mansion tax and the transfer tax
The buyer pays the mansion tax and the supplemental tax. If the buyer doesn’t pay or is exempt, the seller must pay it. Once a buyer fails to pay, the buyer and the seller are both liable for the tax.
The seller has their own bill. The New York State transfer tax and the NYC real property transfer tax are paid by the seller, usually as part of closing costs.
Mansion tax exemptions
Exemptions are narrow. They cover government buyers such as New York State, the United States and the United Nations, plus property sold to a conservation nonprofit for parks, open space or historic preservation.
How many Midwood, Madison and Marine Park sales crossed $1 million
Madison had the highest share of our three neighborhoods. Its median sale this year was $996K, so many buyers there land right around the line.
| This year, January to August | Sales | Median | At $1M or more | At $2M or more |
|---|---|---|---|---|
| Madison | 122 | $996K | 57 (46.7%) | 8 (6.6%) |
| Midwood | 146 | $900K | 61 (41.8%) | 12 (8.2%) |
| Marine Park | 131 | $820K | 20 (15.3%) | 0 (0.0%) |
| All of Brooklyn | 7,005 | $1.03M | 3,522 (50.3%) | 1,299 (18.5%) |
Prices: New York City Department of Finance Rolling Sales, Brooklyn, file dated September 9, 2026, and Annualized Sales for 2025. Recorded sales from January 1 to August 31 of houses with one to three families, condos and co-ops at $100,000 or more, with multi-lot package sales counted once.
Over the same months of 2025, the share was 39.3% in Madison, 43.1% in Midwood and 11.7% in Marine Park. Marine Park had no recorded sale at $2M or more this year. If you own in Madison, our guide to Madison, Brooklyn covers the neighborhood.
How the NYC mansion tax is calculated at $1 million
Once a price reaches the $1 million threshold, the tax applies to every dollar of it. A price below the threshold, even $999,999, owes zero mansion tax. At $1,000,000, the tax due is $10,000.
Recorded prices show deals bunching below that line. Across Brooklyn, 278 sales closed in the last $25,000 under $1M. Just 18 closed in the first $25,000 at or above it.
| Sale price this year | Brooklyn | Midwood | Madison | Marine Park |
|---|---|---|---|---|
| $975,000 to $999,999 | 278 | 6 | 7 | 10 |
| $1,000,000 to $1,024,999 | 18 | 0 | 0 | 1 |
| Exactly $999,000 | 57 | 2 | 2 | 3 |
| Exactly $1,000,000 | 2 | 0 | 0 | 0 |
Same Department of Finance Rolling Sales file, dates and rules as above.
The same dip shows at $2M, where the buyer’s rate steps up to 1.25%. Brooklyn had 186 sales in the last $100,000 below it and 71 in the first $100,000 above. A recorded price can’t tell you why a deal closed where it did, yet a gap this sharp fits buyers and sellers settling just under the tax.
That’s why the mansion tax matters to sellers too. If your home’s value sits near $1M, talk it through before you set a list price. Our guide to selling a Brooklyn home explains how we price block by block.
What types of property the mansion tax applies to
It applies to residential real property: a one, two or three family house, an individual condominium unit or a co-op apartment. The test uses the price of the entire sale, and that price includes any part a mortgage pays for. New York’s mortgage recording tax is a separate tax, not part of this one.
A building that’s part home and part store is taxed only on the home. In the state’s example, a two-family house with a retail unit sells for $1.5M. The whole sale crosses the line, so the tax applies, but only to the $500,000 value of the apartment, which comes to $5,000.
When you pay the mansion tax at closing
It’s paid once, when the home changes hands. For a sale in the city, the tax is paid with Form TP-584-NYC along with the seller’s transfer tax, due by the 15th day after the deed is delivered. In practice, it gets paid at the closing table.
Common follow-up questions
How much is the mansion tax on a $1 million home?
It’s $10,000, which is 1% of $1,000,000. At this year’s Brooklyn median of $1,025,000, the buyer owes $10,250.
Does the mansion tax apply to co-ops and condos?
Yes. Both count as residential property. When a buyer takes several units that aren’t used together, each unit’s own price decides whether the tax applies.
Is the mansion tax paid every year?
No. It’s a one-time tax on the sale, paid by the buyer at closing. Your yearly property tax bill is a separate charge.
Can you avoid the mansion tax?
Only the price lets you avoid the tax. A residential sale at $1,000,000 or more owes it, and if the buyer is exempt, the seller has to pay instead. Talk to your real estate attorney before building a deal around the tax.
From The Behfar Team
We work from our office at 1524 East 23rd Street in Midwood and have closed 494 buyer and seller transactions. So far in 2026 the team reports 60 closed sales worth $80.7 million, 34 of them for sellers. Our 144 Google reviews are the most of any Midwood agency, and our agents speak six languages.
See where your home’s price lands
We’ll give you a price read based on what actually sold near you, so you know whether the mansion tax is part of your buyer’s math. You can also call the office at 347-988-2526.
Rates and rules here come from the New York State Department of Taxation and Finance, and sale counts from the New York City Department of Finance. This is general information, not tax or legal advice. Talk to your accountant or attorney about your own sale.
