Wilson Family Law LLC, 667 Shunpike Road, Suite 5, Chatham, NJ 07928
One of the most significant assets in any divorce is the marital residence. Deciding what happens to the family home is typically a central point of the negotiation process. With the recent changes to New Jersey’s Mansion Tax, the parties should pay close attention to how the implications of this tax could impact the sale of a high-value home.
In July 2025, New Jersey amended its Mansion Tax, which applies to property sales over $1 million. Under the previous version of the law, the buyer was responsible for paying this tax at closing. However, this new amendment shifts responsibility to the seller. This will change the financial dynamics of property transactions, especially those arising out of divorce settlements.
In addition to the shift in responsibility, the amendment also initiated a progressive tax rate. Higher-priced properties are now subject to higher tax rates. The updated tiers are as follows:
For couples selling their homes as part of their divorce, these changes can significantly affect the net proceeds from the sale.
Contracts executed before July 10, 2025, are grandfathered under the old rules. This means that the buyer remains responsible for the Mansion Tax. This exemption lasted until November 15, 2025.
For those amid divorce negotiations, understanding this timeline is crucial. The timing of your property agreement or sale could make a meaningful financial difference. If your marital home is valued above $1 million, then the new Mansion Tax rules could have a direct impact on your divorce settlement. Sellers should work closely with their family law attorneys, real estate agents, and a tax advisor to understand how these changes will affect their strategy.
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Wilson Family Law LLC
667 Shunpike Road, Suite 5
Chatham, NJ 07928
Office: 973-520-4275 Fax: 973-378-0603
email: cindy@wilsonfamilylawllc.com
Website: wilsonfamillylawllc.com