New Jersey's mansion tax moved to the seller, and it names co-op units
New Jersey's mansion tax moved to the seller, and it names co-op units
2026-09-15 · New Jersey · Legislation
New Jersey's "mansion tax" now falls on the seller, rises to 3.5 percent, and expressly covers cooperative units.
A5804 was signed June 30, 2025 as P.L.2025, c.69, effective immediately and applying to transfers occurring on or after July 10, 2025. It amends N.J.S.A. 46:15-7.2 and P.L.2006, c.33, and repeals section 2 of P.L.2005, c.19.1
The two changes
First, the additional fee shifts from the grantee to the grantor. For twenty years it was a buyer's cost; it is now a seller's.
Second, it is graduated rather than flat:
- 1% on consideration over $1 million up to $2 million
- 2% over $2 million up to $2.5 million
- 2.5% over $2.5 million up to $3 million
- 3% over $3 million up to $3.5 million
- 3.5% above $3.5 million
Cooperative units, by name
The covered classes expressly include "a cooperative unit as defined in section 3 of P.L.1987, c.381 (C.46:8D-3)."
That is worth noting because a cooperative transfer is not a conveyance of real property — it is a transfer of shares and a proprietary lease. Naming it removes an argument that would otherwise have been available.
The transitional refund
A refund path exists for sellers who paid above 1 percent where the deed recorded on or before November 15, 2025 under a contract fully executed before July 10, 2025.
What this does not change
Say this clearly, because the change is easy to over-read: nothing about association assessments, reserve obligations or resale certificates. It is a transfer-fee statute. It alters who writes a cheque at closing and how large that cheque is.
Where it touches association practice
Three places, all at the closing table.
The resale and estoppel package an association issues sits alongside the transfer-fee calculation, and in cooperatives the association or its managing agent is often the entity processing the share transfer. Where a co-op's own transfer machinery runs through the board, the board's paperwork is now adjacent to a state fee obligation it was previously distant from.
Second, the seller-side shift changes the economics of a sale in a high-value New Jersey condominium. On a $3.6 million unit the fee is 3.5 percent — $126,000 — out of the seller's proceeds. That is a material number in exactly the buildings where an association is also disclosing an 85 percent reserve-funding notice and an anticipated special assessment.
Third, it is one more disclosure item in a New Jersey closing that has acquired several since 2024: the reserve-funding notice where the 85 percent option is in use, the coming dam-ownership disclosure, and the ordinary resale certificate.
The wider pattern
New Jersey enacted an unusually large volume of law in the 2025 pamphlet year — 405 chapters, with the bulk of chapters 199 through 405 signed between January 9 and January 20, 2026 during the lame-duck session.
That produces a quirk worth knowing for anyone reading New Jersey citations: chapter numbers are assigned by legislative year, not calendar year. Bills signed in January 2026 during lame duck carry P.L.2025 chapter numbers. P.L.2025, c.362, signed January 20, 2026, is the example that catches people out.
A small companion change
On the other side of the ledger, P.L.2026, c.24 — A5325, signed June 30, 2026, effective July 1, 2026 — cut the fee for a nonprofit corporation's original certificate of incorporation from $75 to $50, and the for-profit fee from $125 to $100. The annual report fee is unchanged at $75.
That is the association's own filing fee, and it is a one-time saving of $25 for a newly incorporated community. It is mentioned here for completeness rather than because it changes anything.
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