Mansion Tax

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If you’re fortunate enough to purchase a home over a million dollars in NJ you also get to pay a Mansion Tax of 1% of the purchase price. We all know that a million dollars will definitely get you a Mansion in Hoboken. The 1200sq foot condo over at 1125 Maxwell Lane conjures up remnants of the guilded age in mind. Think I’m going to check to tax records to see how many Rockefellers and Morgans would be my neighbors. (There are 33 condos for sale in Hoboken offered at north of a million dollars. )

The problem comes when the buyer sells the condo for close to the million dollars. (like $1,030,000.) That thirty thousand dollars to the seller essentially costs the buyer $40,300. What is an enterprising buyer to do? Maybe offer to pay $999,999 for the condo and “buy” a piece of furniture from the seller for $31,000. Thus saving the mansion tax. EXCEPT it it illegal. Now I would be shocked to find that anything illegal is taking place in Hudson County but…. Corzine needs his money. He can’t raise turnpike rates so he has to get it somewhere.

Buyers. Sellers. If anyone (realtor, lawyer, friend) suggests this: run. A lawyer just lost his license over this. Think the state isn’t going after the buyer and seller? Probably fining the realtor too. Don’t say you haven’t been warned.

Hoboken Real EstateCondos
Avg Sale Price May 2008 $497,818
Avg Sale Price May 2009 $507,070
Information deemed reliable but not guaranteed

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