Selling in Jersey City comes with a lot of moving parts, and one of the most common surprises is New Jersey’s Realty Transfer Fee. You see this line item on your closing statement and wonder if it’s negotiable, how it’s calculated, and whether the $1 million threshold affects you. If you’re planning a sale, especially at higher price points, understanding this fee helps you protect your net proceeds and avoid last‑minute stress.
In this guide, you’ll learn what the Realty Transfer Fee is, how the tiered schedule works, when the additional graduated percent applies to $1 million and above, and how to prepare for closing day. You’ll also get clear, Jersey City and Central Jersey examples that show how your attorney or title agent will compute the fee for your sale. Let’s dive in.
What the Realty Transfer Fee is
New Jersey’s Realty Transfer Fee is a state tax on real property transfers. It is typically collected at closing and, by default, the seller pays it unless your contract says otherwise. The fee is based on your sale price using a published, multi‑tier schedule.
The New Jersey Division of Taxation maintains the official schedule and instructions. Because the fee is statutory and periodically updated, your closing attorney or title/settlement agent will use the current table to calculate the exact amount due for your transaction.
State fee vs. local charges
The Realty Transfer Fee is a state tax that is separate from county or municipal recording fees. Hudson County and Jersey City may charge local recording or documentary fees, but those are distinct from the state’s Realty Transfer Fee and are handled alongside your other closing costs.
How the fee is calculated
The Realty Transfer Fee uses two layers that work together: a tiered base schedule and, for many high‑value transfers, an additional graduated percent.
Tiered schedule basics
The fee is calculated using a table with dollar bands. Each band corresponds to a fixed fee amount that increases as the sale price rises. The Division of Taxation publishes a current schedule that shows exactly how much is due at common price points. Your settlement agent will reference this table directly when preparing your Closing Disclosure or settlement statement.
Graduated percent at $1M+
For many transactions at or above statutory thresholds, typically $1,000,000 and higher, an additional graduated percent applies to the portion above the threshold. This is not a flat mansion tax. It is a surcharge layered on top of the tiered base fee, which increases the total fee as prices rise into the multi‑million‑dollar range. The Division’s guidance explains the thresholds, any exceptions, and the exact calculation steps.
Who pays and when
By default, sellers pay the Realty Transfer Fee at closing. That said, you and the buyer can agree to a different allocation in your contract. In most residential deals, the closing attorney or title company withholds the fee from your proceeds and remits it to the state.
Jersey City and Central Jersey examples
Below are common price points in Hudson County and Central Jersey, along with the calculation approach your closing team will use. Always rely on the Division of Taxation’s current schedule to compute exact numbers for your sale.
Hudson County example: $900,000 sale
- How it’s handled: Your attorney uses the tiered schedule to locate the fee that corresponds to $900,000. Because this price is below the common $1,000,000 threshold, the additional graduated percent does not apply.
- What to ask: Request a line item on your Closing Disclosure labeled “Realty Transfer Fee” that reflects the fee from the current schedule.
Hudson County example: $1,250,000 sale
- How it’s handled: First, your attorney calculates the base fee from the tiered schedule for a $1,250,000 sale. Then they apply the graduated percent to the portion above the threshold, as specified by the Division’s instructions. The final Realty Transfer Fee equals the base fee plus the surcharge.
- What to expect: The surcharge meaningfully increases the total compared to a sub‑$1,000,000 sale.
Central Jersey example: $550,000 sale
- How it’s handled: Your closing team applies the fee from the tier that corresponds to $550,000. No graduated percent applies because the sale is below the $1,000,000 threshold.
- What to note: While Central Jersey price points often produce smaller RTF totals than Hudson County’s higher bands, you should still verify the exact amount early in your process.
Central Jersey example: $1,000,000 sale
- How it’s handled: Your attorney checks the current Division wording to confirm whether the graduated surcharge applies at exactly $1,000,000 in your property category. If it applies, they add the graduated percent to the portion at or above the threshold per the schedule.
- What to confirm: Ask your closing team to cite the current schedule entry and provide the math in writing.
Step‑by‑step: confirm your exact fee
Because the state’s schedule controls the math, the cleanest path is to ask your attorney or title/settlement agent for a written calculation. Use this checklist to verify it:
- Identify your exact sale price. If you’re offering credits or concessions, confirm whether they affect “consideration” for RTF purposes.
- Locate your price in the Division’s tiered schedule. The schedule lists fees by consideration bands and shows the total due at that price.
- Check whether thresholds apply. If your price is at or above $1,000,000, determine if the graduated percent applies and to which portion.
- Add the surcharge if required. The total RTF equals the base fee from the schedule plus any applicable surcharge.
- Confirm exemptions or special handling. Certain transfers are exempt or treated differently. Your attorney will verify whether your situation qualifies.
Common seller mistakes to avoid
- Not budgeting for the surcharge. If your price could land at or above $1,000,000, plan for the additional graduated percent early.
- Using outdated tables. The schedule is periodically updated. Ask your closing team to use the current Division of Taxation table.
- Waiting until the final statement. Request a preliminary RTF calculation when you first go under contract, not 24 hours before closing.
- Assuming the buyer pays. The seller typically pays unless your contract states otherwise.
Closing‑day checklist for sellers
Use this list to avoid delays and protect your net proceeds.
- Contract review: Confirm who pays the Realty Transfer Fee in your contract. Most standard forms assign it to the seller.
- Accurate RTF calculation: Ask your attorney or title/settlement agent for a written RTF calculation from the current schedule, including any surcharge. Require a line item on your Closing Disclosure or settlement statement.
- Provide payoff information: Gather mortgage, HELOC, judgment, or lien payoff statements so your settlement agent can compute your net.
- Prepare required documents: Bring a valid photo ID, a signed deed as instructed, and any entity documents or affidavits your attorney requests.
- Confirm exemptions: If you believe an exemption applies, provide documentation well before closing to ensure correct handling.
- Coordinate funds and remittance: Confirm how the RTF will be collected from your proceeds and remitted to the state.
- Review your final statement early: Compare your estimated and final RTF and all closing costs at least 24 to 48 hours before closing.
- Keep records: Save your closing package and any proof of RTF paid for future tax reporting.
- Utilities and possession: Schedule final meter reads and confirm keys and possession timing aligned to your closing date.
- Consult a tax professional: If you expect significant capital gains or have a complex basis, ask a CPA how the RTF interacts with your tax reporting.
Key definitions and rules to know
- Consideration: Generally the total price paid, including cash and assumption of mortgages or other consideration, as defined by statute and Division guidance.
- Who pays: Typically the seller, unless otherwise agreed in your contract.
- Exemptions: Certain transfers qualify for exemptions, such as some transfers between spouses or to certain entities. Your attorney will confirm eligibility and documentation.
- Local charges: County or municipal recording fees are separate from the state RTF and appear as additional line items on your settlement statement.
How we help Jersey City sellers
When you are selling at higher price points, every line on your net sheet matters. We help you plan early by coordinating with your attorney and title team to confirm the current schedule, modeling your proceeds at different price scenarios, and keeping you updated through clear, timely communication. If your home is likely to trade near or above $1,000,000, we flag the potential surcharge, discuss pricing and concession strategy, and make sure your final statement reflects the correct RTF calculation.
Ready to understand your numbers and maximize your net? Connect with our team for a data‑driven pricing and proceeds review, including a preliminary RTF check based on your target list price and likely contract range.
FAQs
Who typically pays New Jersey’s Realty Transfer Fee?
- In most residential transactions, the seller pays at closing unless the buyer and seller agree otherwise in the contract.
How does the $1,000,000 threshold affect my fee?
- For many transfers at or above the threshold, an additional graduated percent applies to the portion above the threshold. Your closing team will calculate it using the Division’s current schedule.
Is the Realty Transfer Fee the same as local recording fees?
- No. The RTF is a state tax. Counties and municipalities may charge separate recording or documentary fees that appear as additional closing costs.
Is the Realty Transfer Fee deductible on my taxes?
- The RTF reduces your net proceeds and is a closing cost, not a federal income tax. Consult a tax professional about how it factors into your capital gains calculation.
What does “consideration” include for RTF purposes?
- Consideration generally includes the total price paid, including cash and any assumed mortgage or other consideration, as defined by statute and Division guidance.
Are any transfers exempt from the Realty Transfer Fee?
- Yes. Certain transfers, such as some transfers between spouses or to specified entities, may be exempt. Your attorney will verify eligibility and manage required forms.
When should I ask for my RTF calculation?
- Request it as soon as you go under contract and again when your Closing Disclosure is drafted. Review the final statement at least 24 to 48 hours before closing to confirm accuracy.
If you would like a proceeds estimate that includes the current Realty Transfer Fee calculation, reach out to The Ivanov Group to get started with a tailored plan for your sale.
