As of July 1, 2025, New Jersey’s 2026 State Budget has officially gone into effect, bringing with it significant changes to the state’s so-called “Mansion Tax,” via Assembly Bill 5804. Whether you’re a buyer, seller, investor, attorney, or broker, this impacts high-value real estate transactions immediately.
Here’s what you need to know:
Responsibility Shift
The Mansion Tax burden has officially moved from the buyer to the seller.
New Tiered Tax Structure
This is no longer a flat 1%. It’s now a graduated scale based on consideration in the deed:
- 1% — $1M to $2M
- 2% — $2M to $2.5M
- 2.5% — $2.5M to $3M
- 3% — $3M to $3.5M
- 3.5% — Over $3.5M
Urgent Deadline: July 9, 2025
To lock in the current 1% rate, deeds over $2M must be recorded by July 9. Timing matters—don’t risk county delays.
Refund Opportunity (Limited Window)
Sellers may apply for a refund of the increased tax if:
- The contract was fully executed by July 9, 2025
- The deed is recorded between July 10 and November 15, 2025
- The refund request is submitted within one year of recording
Bottom line:
This law will materially impact how deals are structured, timed, and closed across the state—particularly in the commercial space. Recording delays, missed deadlines, or misunderstanding the tiered rates could prove costly.
If you have questions, are navigating a current transaction, or want to understand how this affects your portfolio or clients—WCRE is here to help.
Let’s talk strategy and ensure you’re protected and positioned properly.
Contact us directly or reach out to our team at Wolf Commercial Real Estate (WCRE) to discuss how we can support you through this transition.
