New Jersey homeowners can now visit a website to calculate how much higher their Home Sales Tax may climb if legislation in Trenton is enacted. The website – www.njhometax.com – is part of a public awareness campaign sponsored by the NJAR® about the state’s Home Sales Tax – officially known as the Realty Transfer Fee – and legislative efforts to permit local governments to impose their own Home Sales Tax.
Legislation being considered would allow local governments to impose a local Home Sales Tax on the sale of real property. The tax would be in the amount of $0.50 per $500 of a home’s sales price. The local tax would be in addition to the current Home Sales Tax that is paid to the state.
Home sellers will feel the strongest impact from a local Home Sales Tax. The home seller typically pays the Home Sales Tax, which is based on the sales price of the property. The result is an instant reduction of homeowner equity.
The state-imposed fee, begun in 1968 as a nominal charge for tracking real estate transactions, has increased dramatically in recent years. The Home Sales Tax on an average home is up 80 percent since 2003. The extra local Home Sales Tax will push the total Home Sales Tax bill up 103 percent since 2003.
The current Home Sales Tax due on a home sold for $356,700 - the median price for an existing home in New Jersey - is $2,799. With the extra local tax, the Home Sales Tax bill would increase 13 percent to $3,156.
The campaign includes radio, mail and print advertising and will use online video to deliver the message to New Jerseyans.