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As anyone who has gone through this process will tell you, buying or selling real estate in New York City is a different experience from just about anywhere else in the world. Although buying and selling real estate may seem like something that would be consistent regardless of location, factors like the nature of the New York market make it a unique experience.
One factor that causes this market to be different from many others is the New York City real estate transfer tax. Since it’s common for people to be unaware of this specific tax until the time comes to pay it, we thought it would be helpful to provide answers to some of the most common questions that come up about it:
When do you need to pay this tax?
The New York City real estate transfer tax, which is often referred to as the Real Property Transfer Tax, applies to sales, grants, assignments, transfers or surrenders of real property in NYC. This tax is also applicable if you own at least 50% of an entity like a corporation that owns property as well and decide to sell the entity.
Is there a threshold for this tax?
Yes, the New York City real estate transfer tax applies to sales or transfers that are for at least $25,000.
Are there exemptions from the New York City real estate transfer tax?
While the United States government and its agencies, New York state and its agencies, and foreign governments are exempt from the tax, exemptions aren’t available for individuals or private companies. Even in the event of someone purchasing property from a government entity, the non-government individual or company is still responsible for paying this tax.
How do you apply for this tax?
If you end up in a situation that requires you to pay the New York City real estate transfer tax, there are two ways to submit your application. In addition to applying in person, the official website of the city of New York makes it possible to apply online.
What’s the best way to prepare for the impact of this tax and other unique factors?
Since the New York City real estate transfer tax is just one example of the unique factors that impact buyers and sellers in this market, it’s easy to understand why buyers often begin to feel overwhelmed. That’s especially true for buyers who are going through this process for the first time.
If you’re thinking about buying property in New York but are worried about encountering unforeseen challenges, the best step you can take is educating yourself about the intricacies of the New York City real estate market. Because we’ve seen firsthand how many obstacles buyers need to tackle, we decided to publish the Home Buyers Handbook.
By downloading the Home Buyers Handbook and taking time to read through all of it, you will be able to learn about all of the different factors that will impact your search for the ideal home in the world’s most competitive real estate market.