A Seller's Taxes and Net Proceeds in New York

You list your apartment for $900,000, an offer comes in at full price, and somewhere in your head a number lights up: nine hundred thousand dollars. That number is a fiction. By the time the wire actually hits your bank account, a stack of fees, taxes, and one or two surprises will have quietly carved it down. The gap between your contract price and your "net proceeds" — the money you walk away with — often runs into six figures in New York. Knowing where every dollar goes before you sign is the difference between a smooth closing and an unpleasant one.

This guide walks through each cost a seller faces in New York, then assembles them into a sample net-proceeds sheet so you can see the math end to end.

As of June 2026. Tax rates, thresholds, and rules change frequently and depend on your specific situation. This is general educational information, not legal, tax, immigration, or financial advice. Always confirm current figures with official sources and consult a licensed attorney and a tax professional (a CPA or enrolled agent) before you sell. Sources are listed at the end.

Brokerage commission — usually the biggest line

For most sellers, the single largest cost is the real estate commission. It is negotiable and not set by law, but in the New York market a total commission in the range of 5%–6% of the sale price has long been customary, typically split between the listing side and the buyer's side. Recent industry changes have made commission terms more openly negotiable, so the exact figure — and how buyer-side compensation is handled — is something to discuss explicitly with your agent. On a $900,000 sale, a 5% commission is $45,000; at 6% it is $54,000. This single line usually dwarfs every tax below it.

Transfer taxes — the city and the state both want a cut

When property changes hands in New York City, two separate transfer taxes apply, and the seller ordinarily pays both.

• NYC Real Property Transfer Tax (RPTT): for residential property, 1.0% of the price if the sale is $500,000 or less, and 1.425% if it is more than $500,000.
• New York State transfer tax: the base rate is $2 for every $500 of price — 0.4%. For NYC residential conveyances of $3 million or more, the state adds an extra $1.25 per $500 (0.25%), raising the state portion to 0.65% at that level.

A point worth underlining for sellers: the mansion tax (1%–3.9% on residential sales of $1 million or more) is paid by the buyer, not you. So is the NYC supplemental tax on high-value homes. Those are real closing costs, but they land on the other side of the table.

Attorney fee, flip tax, and the smaller lines

New York is an attorney-state for real estate — sellers and buyers each retain a lawyer to handle contract and closing. A residential seller's attorney fee is commonly a flat amount; figures vary by attorney and deal complexity, so ask for a quote up front rather than assuming.

If you are selling a co-op, the building may impose a flip tax — despite the name, it is a private transfer fee paid to the co-op's reserve fund, not a government tax. Flip taxes vary widely by building; many fall in the 1%–3% of sale price range, though some are structured as a per-share amount or a percentage of profit, and certain affordable (HDFC) co-ops charge far more. It is customarily a seller cost, but who pays is ultimately set by the building's rules and the contract. Check your proprietary lease and house rules before you list — a flip tax you forgot about can swallow a chunk of your equity.

Other small lines include payoff of your remaining mortgage balance, a possible mortgage payoff/recording fee, any move-out or managing-agent fees, and prorated property taxes and common charges. Browsing comparable listings and recent new developments can help you set a realistic price — and realistic expectations about these costs.

Capital-gains tax — and the exclusion that often erases it

So far these are transaction costs. Capital-gains tax is different: it is owed on your profit, not your sale price, and for many primary-home sellers it is zero.

Your taxable gain is roughly your sale price, minus selling costs, minus your adjusted basis (what you paid plus qualifying capital improvements). Only that gain is potentially taxed.

The Section 121 exclusion is the rule that saves most homeowners. Under IRS Publication 523, if the home was your main home and you meet both an ownership test and a use test — you owned and lived in it as your primary residence for at least 2 of the last 5 years — you can exclude up to $250,000 of gain if single, or $500,000 if married filing jointly. You generally cannot use the exclusion if you claimed it on another home sale within the 2 years before this sale. Partial exclusions exist for certain moves (job, health, unforeseen circumstances).

If your gain exceeds the exclusion (or the home doesn't qualify — say an investment property), the remainder is taxed:

• Federal long-term capital gains (for property held more than a year): 0%, 15%, or 20% depending on your taxable income, plus a possible 3.8% Net Investment Income Tax for higher earners.
• New York State does not give capital gains a preferential rate — it taxes the gain as ordinary income, on a scale that currently reaches 10.9%. NYC residents owe an additional city income tax on top of that.

FIRPTA — the rule foreign sellers must plan for

If the seller is a foreign person for US tax purposes (a non-resident, not a green-card holder or someone meeting the substantial-presence test), FIRPTA requires the buyer to withhold a portion of the sale price and remit it to the IRS — an advance against the seller's potential US tax.

The standard FIRPTA withholding rate is 15% of the amount realized. There are reduced and zero rates tied to the buyer using the property as a residence: generally no withholding when the price is $300,000 or less, and 10% when it is more than $300,000 but not more than $1,000,000. Withholding can also be reduced by applying to the IRS for a withholding certificate when the actual tax owed is lower. Crucially, FIRPTA is withholding, not a final tax — a foreign seller files a US return to reconcile and may receive a refund. If this applies to you, line up a cross-border tax advisor early; the certificate process takes time.

A sample net-proceeds sheet

Here is an illustrative co-op sale to show how the pieces stack up. Figures are examples only, not quotes — your actual numbers will differ.

Line item	Amount
Sale price	$900,000
Less: brokerage commission (≈5%)	−$45,000
Less: NYC RPTT (1.425%)	−$12,825
Less: NYS transfer tax (0.4%)	−$3,600
Less: co-op flip tax (≈2%, building-specific)	−$18,000
Less: seller's attorney fee (illustrative)	−$3,000
Less: misc. (managing agent, payoff, recording)	−$2,000
Net before mortgage payoff & taxes	≈$815,575
Less: remaining mortgage balance (example)	−$400,000
Cash proceeds at closing (example)	≈$415,575

Capital-gains tax, if any, is settled later on your tax return — not at the closing table — and the Section 121 exclusion may reduce it to zero. In this example a roughly 9.4% slice of the sale price went to transaction costs before the mortgage payoff. Plan around the net, never the headline.

Before you list

Run your own net sheet early, ideally before you set a price. Pull your proprietary lease or deed, confirm your flip tax, estimate your basis (dig out improvement receipts), and ask a tax professional whether Section 121 covers your gain. If you're weighing where to go next, our notes on neighborhoods and gated communities may help. When you're ready to model your specific numbers, contact our team — we'll build a net-proceeds estimate for your situation and point you to the right attorney and tax advisor.

Sources

• IRS, Publication 523, Selling Your Home — https://www.irs.gov/publications/p523
• IRS, FIRPTA Withholding — https://www.irs.gov/individuals/international-taxpayers/firpta-withholding
• NYC Department of Finance, Real Property Transfer Tax (RPTT) — https://www.nyc.gov/site/finance/property/property-real-property-transfer-tax-rptt.page
• NYS Department of Taxation and Finance, Real Estate Transfer Tax — https://www.tax.ny.gov/bus/transfer/rptidx.htm
• IRS, Topic No. 701, Sale of Your Home — https://www.irs.gov/taxtopics/tc701