New York taxes capital gains at 10.9%. Combined with federal taxes, your effective rate on a home sale could reach 29.7%.
NY State Rate
10.9%
Top marginal rate; NYC adds up to 3.876%
Federal Rate
15%
Most common long-term bracket
Combined Effective
29.7%
On $150K taxable gain (example)
After the $250K/$500K exclusion, here's what a typical seller might owe.
If New York 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 York don't qualify for the exclusion. You'll owe 10.9% state tax plus federal tax on the full gain, plus 25% depreciation recapture on any depreciation claimed.
In New York, 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 York and nearby states.
| State | Rate | Tax on $150K Gain | Notes |
|---|---|---|---|
| 3.07% | $4,605 | Flat tax rate | |
| 6.99% | $10,485 | Top marginal rate | |
| 8.75% | $13,125 | Top marginal rate | |
| 9% | $13,500 | 5% + 4% surtax on income > $1M | |
| 10.75% | $16,125 | Top marginal rate | |
New YorkYou | 10.9% | $16,350 | Top marginal rate; NYC adds up to 3.876% |
Selling in Pennsylvania instead of New York would save $11,745 in state tax on a $150K gain.
New York's top income tax rate is 10.9%, applied to capital gains as ordinary income. For New York City residents, an additional tax of up to 3.876% applies, bringing the combined state+city rate to nearly 14.8%.
Combined with federal capital gains tax (15-20%) and the NIIT (3.8%), a NYC seller can face a combined marginal rate exceeding 36% on capital gains above the exclusion.
New York also imposes a transfer tax on real estate sales: $2 per $500 of sale price (0.4%), plus a 'mansion tax' of 1% on sales over $1 million and additional progressive taxes on sales over $2M in NYC.
The Westchester, Long Island, and Hudson Valley markets have different tax dynamics than NYC. While state rates apply everywhere, the NYC local tax only applies within the five boroughs.
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