Are you shopping near the one million dollar mark in Larchmont or greater Westchester? If so, the New York “mansion tax” can catch you off guard at closing. You want a clear, simple explanation so you can plan your budget, negotiate smartly, and avoid surprises. This guide breaks down how the tax works locally, what it costs, and the key questions to ask your team before you sign. Let’s dive in.
What the NY mansion tax is
The New York State mansion tax is a one-time 1% tax on certain residential real estate transfers. It applies when the purchase price is $1,000,000 or more. The tax is based on the total consideration for the purchase and is collected at or right after closing.
Where it applies in Westchester
The statewide mansion tax applies across New York, including Westchester County and the Village of Larchmont. If your single-family home, condo, or co-op purchase in Westchester is at or above $1,000,000, the tax is typically triggered and handled as part of your closing documents.
Property types covered
The mansion tax generally covers transfers of:
- One to three family houses
- Condominium units
- Cooperative apartment shares
If the consideration is $1,000,000 or more, the tax usually applies. If your deal involves an entity such as an LLC or trust, or if it includes personal property, ask your closing attorney how those details affect the calculation.
How much you will pay
The tax is 1% of the total consideration. A few quick examples:
- $1,000,000 purchase → $10,000 mansion tax
- $1,200,000 purchase → $12,000 mansion tax
- $2,000,000 purchase → $20,000 mansion tax
This is separate from your down payment and other closing costs. Plan to have these funds available at closing.
Who pays at closing
Under current practice, the buyer pays the mansion tax at closing. While buyers and sellers can negotiate credits or price adjustments, the tax is the buyer’s statutory responsibility and is typically shown on the buyer’s closing statement.
How it interacts with other closing costs
In Westchester, the mansion tax is only one part of the closing picture. You may also see:
- State real estate transfer tax filings
- Mortgage recording tax if you finance
- Title insurance premiums and recording fees
- Attorney, lender, and escrow fees
- Prorated property taxes and, for condos or co-ops, common charges
Exact amounts vary by transaction and municipality. Confirm the full estimate with your title company and closing attorney so your cash-to-close number is accurate.
What counts as “consideration”
Consideration typically includes the contract price and can include any assumed liabilities. For example, if you assume a seller’s mortgage or accept seller financing, that can be included in the taxable amount. Your closing attorney or title company will confirm how your specific deal is treated.
Special notes for condos and co-ops
Condos and co-ops are common in Westchester and Larchmont. If the consideration for a condo unit or co-op shares is $1,000,000 or more, the mansion tax generally applies. Co-op closings reflect the tax in the closing paperwork when the purchase price for the shares meets or exceeds the threshold. Ask how any personal property or underlying mortgage allocation is handled on your statement.
Budgeting and cash flow planning
A simple rule of thumb is to budget an extra 1% of the purchase price for the mansion tax when shopping at or above $1,000,000. Add this to your cash-to-close plan along with your down payment, prepaid items, and lender reserves. Lenders often do not finance the mansion tax through mortgage proceeds, so ask your lender early if any portion can be financed or if it must be paid in cash.
Negotiation tips for buyers and sellers
- Buyers can request a seller credit or a small price adjustment to offset the mansion tax.
- Sellers may agree to concessions depending on market conditions and the strength of the offer.
- In competitive situations, buyers sometimes choose not to ask for credits and instead plan the 1% in their budget to keep their offer strong.
Your agent can share current norms for Larchmont and nearby Westchester closings so you can gauge what is realistic.
Who collects and remits the tax
The closing agent, title company, or attorney typically collects the tax at closing and remits it to the New York State Department of Taxation and Finance. It should appear on your Closing Disclosure or equivalent settlement statement.
Questions to ask your team
Bring these to your next conversation so you get clear, written estimates and timelines:
For your closing attorney or title company
- Will this transaction trigger the NYS mansion tax, and how will it appear on the closing statement?
- How is “consideration” calculated for this deal? Are assumed mortgages or seller financing included?
- What Westchester or local filing and recording fees will apply, and who will collect and remit them?
For your lender
- Can any portion of the mansion tax be financed, or must I bring it to closing in cash?
- What mortgage recording taxes will apply, and how are they calculated?
For your CPA or tax advisor
- Do any exemptions or planning strategies apply to my situation, such as transfers between related parties or estate planning considerations?
- How do the mansion tax and other closing costs affect my overall tax position and cost basis?
For your real estate agent
- How have recent Westchester closings around $1,000,000 handled the mansion tax?
- Are seller credits typical right now in Larchmont for this price band?
Verifying current rules
There are occasional proposals to change thresholds or adopt graduated rates. As of mid‑2024, the statewide rule remained a flat 1% at $1,000,000 and above. Local jurisdictions, such as New York City, have additional transfer tax regimes that are separate from the statewide mansion tax. Always confirm current rules and filing procedures with your closing attorney, title company, lender, and CPA before you go to contract.
The bottom line for Westchester buyers and sellers
If you are shopping near or above $1,000,000 in Larchmont and greater Westchester, treat the mansion tax as a known 1% cost in your budget. Pair that with clear estimates for transfer filings, mortgage recording tax, title, and professional fees so you know your true cash to close. With the right planning and guidance, you can avoid last‑minute surprises and negotiate with confidence.
Ready to run the numbers for your move and map out a smooth closing timeline in Westchester? Connect with Jennifer Baldinger to create a clear plan that fits your goals.
FAQs
Does the NY mansion tax apply to Larchmont homes just over $1,000,000?
- Yes. In Westchester, if your residential purchase price is $1,000,000 or more, the one-time 1% mansion tax typically applies and is collected at closing.
Who pays the mansion tax in Westchester, the buyer or the seller?
- The buyer pays under current practice, though buyers and sellers can negotiate credits or price adjustments as part of the contract.
How is the mansion tax calculated for Westchester co-ops and condos?
- It is usually 1% of the total consideration when the price for the condo unit or co-op shares is $1,000,000 or more, as reflected on your closing statement.
Can you finance the mansion tax as part of your mortgage?
- Often, lenders do not finance the mansion tax through mortgage proceeds, so confirm early with your lender whether it must be paid in cash at closing.
What other closing costs should Westchester buyers expect besides the mansion tax?
- Common items include mortgage recording tax if financing, title insurance and recording fees, state transfer filings, attorney and lender fees, and prorated taxes or common charges.
Are there exemptions for gifts or related-party transfers in Westchester?
- Certain transfers can be exempt under state rules, but treatment depends on the details, so your closing attorney and CPA should confirm whether an exemption applies.
How do I verify current mansion tax rules before closing in Westchester?
- Ask your closing attorney, title company, lender, and CPA to confirm current state and local requirements, forms, and rates before you sign your contract.
