How Much Is the NYC Mansion Tax in 2026? Who Pays and Where the Cliffs Hit

If you’re buying a home in NYC for $1 million or more, you need to know about the mansion tax. It’s a one-time tax paid by the buyer at closing, and unlike transfer taxes, it scales aggressively as the purchase price climbs. The most common mistake buyers make is not budgeting for it. The second most common is bumping just over a tier threshold and paying tens of thousands more than they would have for a slightly cheaper home.

The Tiered Mansion Tax Schedule

NYC layers a tiered mansion tax on top of the original 1 percent. As of 2026, the rates are:

• $1,000,000 - $1,999,999: 1.00 percent
• $2,000,000 - $2,999,999: 1.25 percent
• $3,000,000 - $4,999,999: 1.50 percent
• $5,000,000 - $9,999,999: 2.25 percent
• $10,000,000 - $14,999,999: 3.25 percent
• $15,000,000 - $19,999,999: 3.50 percent
• $20,000,000 - $24,999,999: 3.75 percent
• $25,000,000 and up: 3.90 percent

The rate applies to the entire purchase price, not just the portion above the threshold. That’s the cliff effect.

The Cliff Effect in Action

A $1,999,999 purchase incurs a 1 percent mansion tax of $19,999. A $2,000,000 purchase incurs a 1.25 percent mansion tax of $25,000. One dollar in price difference = $5,001 in additional tax. Smart buyers and sellers negotiate around these thresholds. If you’re buying at $2.05M, your agent should be pushing for a price at or below $1,999,999 with a side credit, or pricing well into the next tier so the marginal benefit is real.

Who Actually Pays It?

Legally and customarily, the buyer. But in soft markets, sellers sometimes credit a portion of the mansion tax to close the deal. This is especially common in luxury Brooklyn submarkets when inventory builds up. If you’re a buyer at the $1M-$2M tier, ask your agent whether asking for a mansion tax credit is realistic in your specific situation.

What About Co-ops and Condos?

The mansion tax applies to both. For co-ops, the price is the contract sale price of your shares plus the proportionate share of the underlying mortgage on the building (in some cases). For condos, it’s straightforward - the contract price triggers the tax. Your attorney will calculate it precisely and include it in your closing statement.

Buying in the $1M+ range in Staten Island or Brooklyn? Book a buyer consultation and we’ll model the full closing-cost picture together.