A one-dollar price increase can add $10,000 in buyer tax. Manhattan mansion tax 2026 starts at exactly $1 million, and New York State’s supplemental tax creates additional jumps at higher Manhattan prices. These are not marginal slices: for one qualifying wholly residential property, the band rate applies to its full consideration. Mixed-use and multiple separately conveyed units require their own allocation and aggregation analysis.
For the broader closing-cost picture, read Brett’s Financial District closing-cost guide. Here, the tax bands are calculated from New York’s statutes and current transfer-tax instructions. The first threshold is exactly $1,000,000.
Manhattan Mansion Tax 2026: The Legal Baseline
The New York State mansion tax is an additional real estate transfer tax on qualifying residential property. It applies when consideration for the entire conveyance is $1 million or more.
The statutory category includes a one-, two-, or three-family house, an individual residential condominium unit, and a cooperative apartment unit.
The tax is imposed by New York State, not by Manhattan or the City of New York. The buyer, legally the grantee, pays it.
The tax is generally collected with the real estate transfer tax return at closing.
If the buyer fails to pay or is exempt, the seller has a duty to pay. Joint and several liability specifically follows buyer nonpayment, not automatically the buyer’s exempt status. A buyer should not confuse legal liability with contractual economics. A seller or sponsor can agree to provide a credit or pay an amount on the buyer’s behalf. That arrangement does not turn the statutory buyer tax into a seller tax. It changes who bears the cost under the contract.
The taxes that may sit beside it
State base tax and City RPTT
The ordinary NYS base tax applies when consideration exceeds $500. It is $2 per $500, or fraction, of taxable consideration, generally 0.4% at round prices.
The seller ordinarily pays it. A contract can shift the economic burden to the buyer, so review the allocation before signing.
New York City’s Real Property Transfer Tax, or RPTT, generally applies when consideration exceeds $25,000. Qualifying individual houses, residential condos, and co-ops generally use the lower residential rate schedule.
Residential Type 1 and Type 2 transfers use 1% at $500,000 or less and 1.425% above $500,000. Type 2 includes specified residential leasehold transfers. Transfers outside those residential categories use 1.425% at or below $500,000 and 2.625% above $500,000.
City RPTT is separate from the mansion tax and ordinarily seller-side. Qualifying deed and economic-interest transfers, including cooperative stock transfers, can trigger it. Seller nonpayment or exemption can place responsibility on the buyer.
The separate additional base tax
NYS additional base tax applies to qualifying NYC residential conveyances at $3 million or more and nonresidential conveyances at $2 million or more. It is ordinarily seller-side.
The rate is $1.25 per $500 or fraction. For qualifying residential transfers, the current return applies it to taxable consideration after any permitted continuing-lien deduction. For nonresidential transfers, the form uses consideration before that deduction. A qualifying partly residential property’s additional-base-tax calculation is not limited to its residential percentage.
At exactly $3 million, a wholly residential conveyance generally has $30,000 mansion tax and $15,000 supplemental tax: $45,000 buyer-side.
The separate seller-side additional base tax is $7,500, assuming no exemption, credit, continuing-lien deduction, or grandfathering.
How the buyer-side rate works
These examples cover one wholly residential property, with no exemption, credit, aggregation, or special allocation. The mansion tax starts at $1 million; the supplemental tax starts at $2 million.
Each bracket rate applies to the full relevant consideration, not just the excess. Approximate examples round percentage calculations to cents; counsel should confirm the amounts entered on each return.
Under $1 million: no mansion tax
A $999,999 qualifying residential purchase has no NYS mansion tax and no NYC supplemental tax. This does not mean the closing is tax-free.
NYS base RETT and NYC RPTT may still apply, along with recording, title, lender, attorney, and building charges.
At exactly $1,000,000, the result changes sharply. The mansion tax is 1% of the full $1,000,000, or $10,000. A buyer does not pay 1% only on the dollar above the threshold.
$1 million to under $2 million: 1% buyer-side rate
From $1,000,000 up to, but not including, $2,000,000, the mansion tax is 1% and the supplemental tax is zero. At $1,500,000, mansion tax is $15,000; at $1,999,999, it is $19,999.99.
The $1,999,999 example is useful in negotiation. A price of $2,000,000 moves into the first supplemental band, so the buyer-side charge increases even though the purchase price rises by only $1.
$2 million to under $3 million: 1.25% buyer-side rate
At $2,000,000, the mansion tax remains 1%, or $20,000. The supplemental tax is 0.25% of $2,000,000, or $5,000. The buyer-side total is therefore $25,000, equal to 1.25% of the full price.
At $2,999,999, the mansion tax is $29,999.99 and the supplemental tax is approximately $7,500. The combined buyer amount is approximately $37,499.99.
$3 million to under $5 million: 1.5% buyer-side rate
At $3,000,000, the mansion tax is $30,000. The supplemental tax is 0.5%, or $15,000. The buyer-side total is $45,000.
The $3 million threshold also activates the State’s NYC residential additional base tax. Without adjustments, that seller-side tax is $7,500. Do not add it to buyer costs unless the contract or law requires it.
$5 million to under $10 million: 2.25% buyer-side rate
At exactly $5,000,000, the mansion tax is $50,000. The supplemental tax is 1.25%, or $62,500. The buyer-side total is $112,500. This is one of the largest threshold cliffs. A $4,999,999 purchase has approximately $74,999.99 in buyer mansion and supplemental taxes. A $5,000,000 purchase has $112,500.
One additional dollar of price can therefore increase the buyer-side tax by approximately $37,500.01.
At $9,999,999, the mansion tax is $99,999.99 and the supplemental tax is approximately $124,999.99. The buyer-side total is approximately $224,999.98.
$10 million to under $15 million: 3.25% buyer-side rate
At exactly $10,000,000, the mansion tax is $100,000. The supplemental tax is 2.25%, or $225,000. The combined buyer-side amount is $325,000.
$15 million to under $20 million: 3.5% buyer-side rate
At exactly $15,000,000, the mansion tax is $150,000. The supplemental tax is 2.5%, or $375,000. The buyer-side total is $525,000.
$20 million to under $25 million: 3.75% buyer-side rate
At exactly $20,000,000, the mansion tax is $200,000. The supplemental tax is 2.75%, or $550,000. The buyer-side total is $750,000.
$25 million and above: 3.9% buyer-side rate
At exactly $25,000,000, the mansion tax is $250,000. The supplemental tax is 2.9%, or $725,000. The buyer-side total is $975,000.
At $30,000,000, the combined buyer-side charge is 3.9% of the full price, or $1,170,000. The supplemental rate does not keep increasing above $25 million under the current statutory schedule.
What counts as taxable consideration
Price, debt, and noncash value
Taxable consideration is broader than cash delivered at closing. It generally includes the price paid or required, noncash value, option or contract payments, discharged obligations, mortgages, liens, and other encumbrances.
A qualifying continuing-lien deduction can affect State base tax for certain houses and individual residential condos or co-ops. That base-tax deduction does not reduce mansion or supplemental tax.
Financing changes the source of funds, but it does not automatically change the mansion-tax consideration.
Consider a condo with total consideration of $1,000,000, including a $400,000 existing mortgage that remains in place. Mansion tax is still $10,000. Base-tax treatment can differ.
Shifted expenses and sponsor credits
Buyer payment of a seller obligation can add consideration. Section 1404 contains a specific exclusion for contracted buyer payment of State transfer tax on residential conveyances. Have counsel apply that exclusion to the appropriate State calculation. It is not a blanket rule for NYC RPTT or every shifted expense.
Seller payment of the buyer’s mansion tax does not itself reduce mansion-tax consideration. Distinguish a tax payment from a genuine price reduction, and reconcile the contract with the closing statement.
Mixed-use and entity transactions
For mixed-use property, entire consideration can determine the mansion or supplemental band, while the tax applies to the residential-attributable amount. The additional-base-tax calculation follows a different rule, described above.
Multiple properties require apportionment review. Buying a controlling interest in a property-owning entity can also trigger transfer taxes; purchasing the entity instead of a deed does not automatically avoid them.
Condos, co-ops, houses, and sponsor sales
Confirm the interest being purchased
A condominium buyer receives a deed to an individual unit. The Attorney General identifies 130 William Street Condominium as a Manhattan new-construction plan effective December 4, 2019. That filing establishes the project identity and plan date, not any unit’s price or tax result.
A co-op buyer receives shares and a proprietary lease, but the mansion-tax definition includes a cooperative apartment unit.
The tax applies based on the qualifying residential interest, not on whether the buyer plans to occupy it as a primary home.
Original sponsor co-op transfers can include a proportionate share of the corporation’s underlying mortgage in consideration. For subsequent transfers, that mortgage-share rule applies to units other than individual residential units. Individual residential co-op resales have separate lien provisions. Counsel should distinguish the corporation’s blanket mortgage from the shareholder’s debt and determine the base for each tax.
Multiple units are not one simple calculation
Multiple co-op apartments transferred together generally use NYC’s higher bulk-transfer rate on aggregate consideration. Physically combined units may warrant different treatment; a future combination plan alone does not determine the result.
For separate condo deeds in a bulk transaction, the higher City schedule generally applies to each deed using a reasonable allocation.
State mansion and supplemental treatment differs. Units used together or with a clear relationship can be treated jointly; otherwise allocated consideration is generally tested separately. Separate deeds alone do not resolve the State analysis.
A sponsor concession should specify the covered taxes and any cap. It can reduce buyer cash without automatically reducing taxable consideration or moving the purchase below a threshold.
The Attorney General’s sponsor-disclosure guidance addresses these taxes in offering plans. Review the plan, amendments, and contract together rather than relying on a sales concession summary.
Exemptions and Who Pays
Exemption claims need their own analysis
State exemptions cover specified governmental transactions, qualifying gifts without consideration, conveyances securing debts or other obligations, corrective conveyances, partitions, bankruptcy transfers, and mere changes of form without changed beneficial ownership. The mere-change exemption has a co-op exception for conveying the cooperative building to its housing corporation. A limited proportionate credit may instead apply to certain original share transfers, subject to statutory conditions.
NYC separately recognizes exemptions, including specified governmental, nonprofit, unchanged-beneficial-ownership, and HDFC transfers. A City exemption does not automatically eliminate a State tax.
Since May 9, 2025, qualifying conveyances for open-space, parks, or historic-preservation purposes to specified conservation-oriented tax-exempt nonprofits are exempt from the mansion tax. That is an additional-tax-only exemption, not blanket relief from every transfer tax. A routine primary residence, first purchase, or foreign-buyer status creates no ordinary mansion-tax exemption.
The mansion tax and supplemental tax are buyer-side by statute. The base NYS transfer tax, NYC RPTT, and residential additional base tax are ordinarily seller-side.
The buyer can still pay seller-side taxes when the contract says so, or when a seller fails to pay or is exempt.
The narrow older-contract rule
The State’s NYC additional base and supplemental taxes do not apply to qualifying binding contracts entered into on or before April 1, 2019, with independently supported execution dates. That grandfather rule does not remove the ordinary base tax, 1% mansion tax, or City RPTT.
Filing and closing timing
NYS returns and taxes are generally due by the 15th day after delivery of the instrument effecting the conveyance. For recorded deeds, payment and filing are handled through the recording process. If the instrument is not recorded, or recording occurs later, the State filing and payment deadline still applies. Counsel should arrange direct filing where required. NYC RPTT has its own filing requirements and generally must be filed within 30 days after transfer, even where the tax is zero or an exemption is claimed.
The NYS Form TP-584-NYC, not the separate City RPTT return, contains schedules for the NYS base, additional base, mansion, and supplemental taxes and certain estimated-income-tax certifications. The two returns have distinct filing requirements.
Nonresident sellers may need separate estimated-income-tax filings. Those are not the buyer’s mansion tax. Ask the closing team to reconcile each return rather than treating every tax line as one charge.
Buyer Strategy: price, contract, and cash planning
Start with the full price, not the down payment. Run the mansion and supplemental calculation at the proposed price, one dollar below each relevant threshold, and exactly at the threshold. That comparison shows whether a small price change creates a large cash difference. Negotiate with the total acquisition cost in view, not just the headline offer.
Ask the broker and attorney to identify whether the contract is deeded, co-op, sponsor, bulk, mixed-use, or otherwise unusual. Confirm which party pays each ordinary transfer tax, whether the sponsor provides a credit, whether a credit is capped, and whether the stated price includes parking, storage, furniture, or other rights.
Do not rely on a generic closing-cost percentage. A financed condo may add mortgage recording tax and title costs. A co-op may avoid mortgage recording tax but add lender, managing-agent, board, transfer, or building charges.
A sponsor purchase may add working capital, reserve, legal, move-in, or other plan-specific costs.
Before signing, request a written estimate showing the statutory payer, contractual payer, taxable consideration, mansion-tax band, supplemental band, City RPTT rate, NYS base tax, additional base tax, and all concessions.
The final closing statement should reconcile those estimates.
For a purchase near a threshold, contact Brett about your Manhattan purchase. Coordinate the cash budget and contract allocation with your attorney before committing.
Frequently Asked Questions
No. The 1% mansion tax is imposed by New York State and applies statewide to qualifying residential conveyances at $1 million or more. The supplemental schedule is also a New York State tax, but it applies to qualifying residential conveyances in a city with at least one million residents, currently New York City.
Manhattan is therefore within the NYC supplemental regime, but the label “NYC mansion tax” can obscure the separate legal sources.
Ask for two separate State tax lines on your estimate. City RPTT is another charge, normally seller-side; a sponsor contract that shifts it can increase your cash requirement substantially.
Yes. The statute says $1 million or more. At exactly $1,000,000, the mansion tax is $10,000. A $999,999 purchase does not incur the mansion tax, assuming no aggregation or other rule changes the consideration.
The buyer should model the full price, not just the amount above the threshold.
The return may also require supporting information about the property, parties, and consideration. That paperwork does not create an exemption, but it helps the closing team document why the selected band and tax base are correct. This is why an offer at $1,000,000 is not economically equivalent to an offer at $999,999. The seller receives only one additional dollar in stated price, while the buyer takes on a $10,000 tax.
The parties can negotiate a different price, but they cannot change the statutory threshold by describing the transaction as an ordinary home purchase or by using a mortgage.
No. The schedule is a cliff structure. At $2 million, the mansion tax is 1% of $2 million and the supplemental tax is 0.25% of $2 million. The combined buyer-side amount is $25,000. It is not 1.25% of the single dollar above $1,999,999. That example assumes one wholly residential conveyance. For mixed-use property or several units, counsel must first determine the qualifying conveyance, allocation, and residential amount before applying the rate.
Generally, a qualifying individual residential co-op apartment is within the mansion-tax definition, just as an individual residential condo is.
The legal form differs because a co-op transfers shares and a proprietary lease rather than a deed. Co-op mortgage and multiple-unit rules can change the consideration or NYC RPTT analysis, so the unit documents matter. A buyer purchasing multiple co-op or condo units should not assume the total price always controls State thresholds. Uncombined units not used together are generally tested separately using allocated consideration for State mansion and supplemental taxes. Connected or interdependent units can require aggregation.
NYC bulk-transfer treatment differs, so separate contracts alone do not settle either question.
Yes. A sponsor can contractually provide a credit or pay on the buyer’s behalf. That is a negotiated economic allocation, not a statutory exemption.
The buyer should confirm whether the concession covers only the mansion tax or also the supplemental tax, seller-side transfer taxes, legal fees, and other closing charges.
Seller payment of mansion tax does not itself reduce the taxable consideration. A true price reduction is different; counsel should confirm the agreement’s tax treatment before calculating a threshold.
Not ordinarily. The mansion tax focuses on the type of residential property and the consideration, not on first-time status, citizenship, or whether the purchase is a primary residence. A part-time residence or investment apartment can qualify as residential property.
Statutory exemptions can cover specified governmental transactions, qualifying nonprofit conveyances, gifts, partitions, bankruptcy transfers, and mere changes of form. Conveyances securing a debt or other obligation can also qualify; documentation and statutory conditions matter.
A qualifying exemption must be claimed and supported in the applicable return. It should not be assumed merely because the buyer has a particular immigration status or intends to live in the unit.
A transaction that is exempt from one tax may still require a return, and a City exemption may not automatically eliminate a State tax.
For Manhattan mansion-tax planning or another NYC purchase, talk with Brett about your buying plans. Confirm the full cash-to-close calculation with your attorney.
