Realty Transfer Fee
Information and Resources
The FY 2026 New Jersey budget calls for increases to the Supplemental Fee to the Realty Transfer Fee, now known as the Graduated Percent Fee
Here’s the breakdown of the new tax, which would now be entirely paid by the seller, on amounts in excess of:
- $1 million+: The existing 1% “mansion tax” remains, but the responsibility shifts from the buyer to the seller, amending the 2004 law.
- $2 million+: 2% tax on the seller.
- $2.5 million+: 2.5% tax on the seller.
- $3 million+: 3% tax on the seller.
- $3.5 million and above+: 3.5% tax on the seller.
For all contracts fully executed on or after July 10, 2025, where the home has a sales price over $1 million, the 1% fee paid by the home buyer is eliminated. Instead, a graduated percent fee is imposed on the seller, calculated as a tiered percentage based on the sales price.
For all contracts fully executed prior to July 10, 2025, where the deed is recorded on or before November 15, 2025, any graduated percent fees paid in excess of 1% will be refunded to the seller.
Understanding the Realty Transfer Fee and the Graduated Percent Fee
The Realty Transfer Fee (RTF) was established in New Jersey in 1968 to offset the costs of tracking real estate transactions. Upon the transfer of the deed to the buyers the seller pays the RTF, which is based on their property's sales price. Payment of the RTF is a prerequisite for recording the deed. In addition to the RTF paid by sellers, a 1% fee is required to be paid by the buyer on all transactions over $1,000,000 in both commercial and residential property classes. However, beginning July 10, 2025, pursuant to N.J.S.A. 46:15-7.2, this 1% buyer fee is eliminated. Instead, a Graduated Percent Fee is imposed on the seller for transactions exceeding $1 million. This Graduated Percent Fee is calculated based on a tiered percentage structure, depending on the sales price, as outlined in the calculator above. The Graduated Percent Fee is separate from, and is assessed in addition to, the standard RTF. The RTF and the graduated percent fee are usually collected at the real estate closing by the legal representatives or title insurance agents responsible for recording the deed at the county registry offices. The funds are then shared between the state and counties. The state portion of the revenue is allocated to neighborhood revitalization, shore protection, and the state's general fund. The counties are responsible for disbursement of their portion of the revenue. Unlike the Graduated Percent Fee, certain transactions may be exempt from the RTF. By way of example, the RTF does not apply to sales for less than $100 or to transactions made between husbands and wives or parents and children. Senior Citizens, blind or disabled persons, and low-and moderate-income housing may qualify for a partial exemption from the RTF. An Affidavit of Consideration must be filed with any deed in which a full or partial exemption is claimed from the RTF. More information on the RTF and the Graduated Percent Fee is available from the New Jersey Department of the Treasury or by calling (609) 292-7974.
RTF RESOURCES
Graduated Percent Fee Chart
The Supplemental Fee to the Realty Transfer Fee will now be entirely paid for by the seller.
RTF Calculator
Use our RTF calculator to see the approximate cost of the RTF and the Supplemental Fee.
Fee Increase Explained
Share this flyer with your colleagues and clients to explain the RTF and the Supplemental Fee.
FREQUENTLY ASKED QUESTIONS
*Information current as of July 2, 2025.
The new tax structure takes effect for transfers of real property starting July 10, 2025.
A “contract that was fully executed” is a contract signed by both parties that is out of attorney review.
Unlike the Realty Transfer Fee, the Graduated Percent Fee does not have a provision for discounts.
The money is set to go to the General Fund.
The Graduated Percent Fee applies to all residential and most commercial properties. According to the State of New Jersey: “As a supplemental fee to the RTF, the State imposes a fee on the recording of the deed for the sale of real property when the consideration paid is more than $1,000,000. This additional fee applies to all deeds where the land conveyed is classified as follows:
- Class 2 residential;
- Class 3A where the property is a farm (but only if the farmland contains a building or structure intended or suited for residential use);
- Class 4A commercial (other than industrial or apartment); and
- Class 4C cooperative units.
New Jersey recognizes certain exemptions from the supplemental fee. Information on exemptions is found on Form RTF-1EE, Affidavit of Consideration for Use by Buyer, and must be annexed to every deed for consideration over $1,000,000 and with every commercial property transfer.
Yes, the Realty Transfer Fee has been in effect since 1968. The Graduated Percent Fee, formerly known as the “mansion tax” or “Supplemental Fee to the Realty Transfer Fee”, was implemented in 2004 for residential and 2006 for commercial, and until the FY 2026 budget was passed, was paid for the buyer.
Yes, if the deed is recorded prior to July 10, 2025, the old tax structure where the buyer pays the 1% Graduated Percent Fee, or “mansion tax”, would still apply.
We are actively working on updating sections of the Contract of Sale and working on an addendum.
No, a fully executed contract must be in place prior to July 10, no matter when the deed is recorded, to be eligible for a refund.
The Division of Taxation has directed those qualified for refunds to use this form until a new one is created.
Treasury has indicated that refunds typically take 4-6 weeks to process, but could take longer depending on the volume they receive with regard to this new fee structure. All documentation must be included in the refund request in order to expedite the process.
You may email the RTF-3 form and accompanying documentation to taxation.rtfrefunds@treas.nj.gov.
Please see this memo from the Division of Taxation for additional guidance.
It depends on the price point.
If a transaction between $1,000,000.01 and $2,000,000 is out of attorney review prior to July 10, 2025 and the contract states the buyer will pay the 1% Graduated Percent Fee, (also known as the “mansion tax”), the buyer is still responsible for that fee.
If a transaction is over $2,000,000 and is out of attorney review prior to July 10, 2025 and the contract states the buyer will pay the 1% Graduated Percent Fee, (also known as the “mansion tax”), the buyer is still responsible for that 1% fee. The seller would be responsible for any amount over the 1% and can then apply to the State of New Jersey for a refund.
The Graduated Percent Tax is the name the State of New Jersey Department of Treasury has given the former “mansion tax” or “Supplemental Fee to the Realty Transfer Fee.” This is how they refer to this fee on all their documentation.
