New Jersey taxes capital gains at 10.75%. Combined with federal taxes, your effective rate on a home sale could reach 29.5%.
NJ State Rate
10.75%
Top marginal rate
Federal Rate
15%
Most common long-term bracket
Combined Effective
29.5%
On $150K taxable gain (example)
After the $250K/$500K exclusion, here's what a typical seller might owe.
If New Jersey is where your primary residence is located and you've lived there at least 2 of the last 5 years, you can exclude up to $250K (single) or $500K (married filing jointly) of your capital gain from both federal and state taxes.
Investment and rental properties in New Jersey don't qualify for the exclusion. You'll owe 10.75% state tax plus federal tax on the full gain, plus 25% depreciation recapture on any depreciation claimed.
In New Jersey, homes sold in March sell for 23% more than those sold in October (-15%). Timing your sale right can offset a significant portion of your tax bill.
Capital gains tax rates on home sales in New Jersey and nearby states.
| State | Rate | Tax on $150K Gain | Notes |
|---|---|---|---|
| 3.07% | $4,605 | Flat tax rate | |
| 6.6% | $9,900 | Top marginal rate | |
New JerseyYou | 10.75% | $16,125 | Top marginal rate |
| 10.9% | $16,350 | Top marginal rate; NYC adds up to 3.876% |
Selling in Pennsylvania instead of New Jersey would save $11,520 in state tax on a $150K gain.
New Jersey has a top capital gains rate of 10.75%, one of the highest in the nation. The state also imposes an exit tax (estimated withholding) for sellers leaving the state.
New Jersey's high property values, particularly in Bergen, Essex, and Morris counties, frequently generate gains above the exclusion.
The exit tax (2% of sale price or estimated tax, whichever is greater) is withheld at closing for sellers moving out of state.
Shore communities from Cape May to Long Branch add seasonal property dynamics with potential for significant gains on waterfront property.
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