Selling a home in New York City comes with a tax bill that surprises most homeowners. Between transfer taxes, potential capital gains, and closing costs, you could owe 8-10% of your sale price before you see a dollar of profit. Here is exactly what to expect in 2026, with real numbers for Staten Island and Brooklyn sellers.
How Much Tax Do You Pay When Selling a House in New York?
The total tax burden for selling a home in NYC typically runs 8-10% of the sale price. On a $750,000 Staten Island home, that means $60,000-$75,000 in combined costs. Transfer taxes alone run 1.4-2.075% depending on sale price. Capital gains depends entirely on how much profit you made and whether you qualify for the primary residence exclusion. Work with Joseph Ranola and the Bridge and Boro Team to get a detailed seller net sheet before you list.
Do I Have to Pay Capital Gains Tax When I Sell My Primary Home in NYC?
The IRS Section 121 exclusion is the single biggest tax break for home sellers. If the property was your primary residence for at least 2 of the last 5 years, you can exclude up to $250,000 in profit ($500,000 for married couples filing jointly). For many Staten Island and Brooklyn homeowners, this wipes out the federal capital gains bill entirely. New York State follows similar rules but has its own rate of 4-10.9% depending on income.
What Are NYC and NYS Transfer Taxes on a Home Sale?
Transfer taxes are non-negotiable closing costs every seller pays. NYC charges 1% on sales under $500,000 and 1.425% at $500,000+. New York State adds 0.4% on all residential sales, plus a 0.65% mansion tax on sales of $1 million or more. On a $750,000 sale, combined transfer taxes come to about $13,688. These are paid at closing and come directly out of your proceeds.
How Can I Reduce Taxes When Selling My NYC Home?
Smart sellers plan ahead. Make sure you qualify for the Section 121 exclusion by living in the home for at least 2 years. Track every capital improvement (kitchen remodel, new roof, bathroom renovation) because these increase your cost basis. For investment properties, talk to a CPA about a 1031 exchange to defer capital gains. Holding for more than one year qualifies you for lower long-term capital gains rates.
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Joseph Ranola is a 65+ five-star Google reviewed real estate agent covering Staten Island and Brooklyn with the Bridge and Boro Team at Real Broker.
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