Who Pays the Mansion Tax in NJ? - Christine Matus

From The Matus Law Group - Who Pays the Mansion Tax in NJ? explains how New Jersey’s mansion tax applies to property transfers over $1 million and how the 2025 amendments under N.J.S.A. 46:15-7.2 shift responsibility from buyer to seller. This episode walks through the updated law signed by Governor Phil Murphy through Bill S4666/A5804, clarifying what buyers and sellers need to know when deeds are submitted for recording on or after July 10, 2025, and how this impacts real estate transactions across Monmouth County and the state.

Listeners will gain a clear understanding of how the mansion tax interacts with the Realty Transfer Fee (RTF) under N.J.S.A. 46:15-5, how it is collected by county recording offices like the Monmouth County Clerk’s Office in Freehold, and why more properties are now subject to the tax due to the unchanged $1 million threshold since 2004. The discussion highlights key calculation examples, including how rates apply to total consideration rather than just the amount above $1 million, often surprising both buyers and sellers.

The episode also breaks down the new tiered tax structure introduced in 2025, covering rates from 1% to 3.5% depending on sale price, and explores how property classifications under N.J.A.C. 18:12-2.2 determine applicability. It outlines which property types qualify—such as residential property, cooperative units, farm property with residential use, and Class 4A commercial property—and which are exempt under N.J.S.A. 46:15-10, including vacant land, industrial properties, and certain tax-exempt transfers. Forms like RTF-1 and RTF-1EE, along with guidance from the New Jersey Division of Taxation and IRS rules, are also discussed.

Christine Matus of The Matus Law Group shares insights from decades of experience helping clients across Red Bank, Toms River, Monmouth County, and Ocean County navigate real estate transactions. The episode emphasizes the importance of reviewing contracts, understanding exemption eligibility, and planning around pricing thresholds that can significantly affect tax liability. Whether you're buying or selling in New Jersey, this conversation provides practical guidance to help you manage closing costs and avoid unexpected financial burdens.

The Matus Law Group

125 Half Mile Rd #201A, Red Bank, NJ 07701, United States

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