What Taxes Do I Pay When Selling a Home on Long Island?

What taxes do I pay when selling a home on Long Island?
When you sell a home on Long Island, you may be responsible for state transfer taxes, local fees, and potentially federal or state capital gains tax. Eric Berman REALTOR helps sellers understand these costs so they can prepare financially. (Always consult a licensed tax professional for personalized advice.)

1. New York State Transfer Tax

• Rate: $4 per $1,000 of the sale price (0.4%)

• Example: On a $600,000 sale, the transfer tax would be $2,400

• Collected at closing and paid to the state

For higher-value properties over $1 million, an additional “mansion tax” applies (paid by the buyer).

2. Local Fees

Depending on where your home is located, you may owe:

• Nassau or Suffolk county recording fees

• Village or town fees for permits, certificates of occupancy, or smoke/carbon monoxide compliance

These vary but generally range from $200–$1,000+.

3. Property Taxes at Closing

At closing, sellers must:

• Pay property taxes up to the closing date

• Settle any unpaid balances

If you’ve already paid ahead, you may receive a credit back for prepaid taxes.

4. Federal and State Capital Gains Tax

You may owe capital gains tax on the profit from your home sale.

Primary Residence Exclusion

• If you’ve lived in the home 2 of the last 5 years, you may exclude:

  • Up to $250,000 of gain (single filers)

  • Up to $500,000 of gain (married filing jointly)

When Capital Gains Apply

• If your profit exceeds these limits

• If the property was not your primary residence (investment or vacation property)

Capital gains tax rates vary depending on income and length of ownership.

5. Other Potential Taxes and Fees

• Estate or inheritance considerations (if selling inherited property)

• Withholding for out-of-state sellers

• IRS reporting requirements

Always review these with your accountant or tax attorney.

How Eric Berman REALTOR Helps

Eric provides:

• Net sheets estimating transfer taxes and closing costs

• Guidance on local fees and permit requirements

• Referrals to trusted tax professionals for detailed advice

This ensures you have a clear picture of your bottom line before listing.

Final Thoughts

Selling your Long Island home may involve more than just commissions and closing costs—taxes play a role, too. Planning ahead helps avoid surprises at closing.

Want a clear breakdown of your selling costs?

Contact Eric Berman REALTOR today for a personalized estimate and guidance on your next move.

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What taxes do you pay when selling a Long Island home? Eric Berman REALTOR explains transfer tax, property tax, and capital gains to help sellers prepare.