"Greg was very easy to work with. I had a complicated scenario that he was able to manage, with complete confidence. I would highly recommend using him."
"I've had a great experience working with Greg Monaco. He is incredibly detail-oriented and thorough, making sure everything is handled correctly and fully compliant. What really stood out to me is how proactive and dedicated he is."
"Monaco CPA is excellent to work with! Greg is detail-oriented, knowledgeable, and prompt. He's been instrumental in helping me get my business off the ground with a strong financial foundation."
"If you need a CPA or accountant in Livingston or Essex County, I highly recommend Greg at Monaco CPA. My wife and I switched because my old accountant often didn't return my calls. Greg is different."
"I've been working with Greg Monaco, CPA for a few years now, and he's honestly saved me real money with both personal tax help and crypto tax stuff."
"I've been working with Gregory Monaco CPA LLC for my taxes, and I couldn't be happier with the experience. Extremely professional, thorough, and organized from start to finish."
Free Tax Tool · Updated for 2026
Estimate your NJ exit tax withholding (greater of 10.75% of gain or 2% of sale price), actual tax liability on graduated brackets, refund via Form A-3128, and which GIT/REP form you need. Includes the new seller-paid Mansion Tax rates effective July 2025 and full Section 121 exclusion logic.
Enter your property sale details below. All calculations run in your browser.
The total consideration stated in the deed.
Additions, renovations, new systems (not repairs). These increase your basis.
Lived in the home 2+ of the last 5 years?
Required for the IRC Section 121 exclusion ($250K single / $500K MFJ).
Used only for net proceeds calculation, not for tax computation.
Auto-calculated at 6% of sale price. Override below if you know the exact amount.
Using estimate: $39,000
Are you staying in New Jersey?
NJ residents file GIT/REP-3 and owe nothing at closing.
| Detail | Amount |
|---|---|
| Sale price | $650,000 |
| Original purchase price | $350,000 |
| Selling costs (6%) | $39,000 |
| Gross gain | $261,000 |
| Section 121 exclusion (single, $250K) | $250,000 |
| Taxable gain | $11,000 |
| Option A: 2% of sale price | $13,000 |
| Option B: 10.75% of taxable gain | $1,183 |
| Withholding at closing (GIT/REP-3 Box 2) | $0 |
| Estimated NJ tax on taxable excess | $140 |
| Suggested NJ-1040-ES payment after recording | $140 |
This example shows a single filer selling a primary residence for $650,000 with a $350,000 basis. The $261,000 gross gain is mostly covered by the $250,000 Section 121 exclusion, leaving only $11,000 taxable. Because the home qualifies as a principal residence, the seller can file GIT/REP-3 (Box 2) with $0 withholding at closing and make an NJ-1040-ES payment after recording for the taxable excess. A married couple filing jointly with a $500,000 exclusion would have no taxable excess in this example. Schedule a free consultation for your exact numbers.
The Graduated Percent Fee applies to sales over $1,000,000 for residential, commercial, and cooperative properties. Effective July 10, 2025, the fee shifted from buyer to seller. These are cliff rates applied to the entire sale price, not marginal rates.
| Sale Price | Rate | Example Fee |
|---|---|---|
| $1,000,001 to $2,000,000 | 1% | $15,000 on a $1.5M sale |
| $2,000,001 to $2,500,000 | 2% | $45,000 on a $2.25M sale |
| $2,500,001 to $3,000,000 | 2.5% | $68,750 on a $2.75M sale |
| $3,000,001 to $3,500,000 | 3% | $97,500 on a $3.25M sale |
| Over $3,500,000 | 3.5% | $175,000 on a $5M sale |
N.J.S.A. 46:15-7.2 as amended by P.L. 2025, c.69 (S4666/A5804), signed June 30, 2025. Applies to Class 2 (residential), Class 3A (farm with residential structures), Class 4A (commercial), and Class 4C (cooperatives). Does not apply to vacant land, industrial property, or apartments with 5+ units.
The NJ "exit tax" is an estimated Gross Income Tax prepayment required under N.J.S.A. 54A:8-8 through 54A:8-10 when a nonresident individual, estate, or trust sells New Jersey real property. Enacted by P.L. 2004, c.55, this mechanism ensures NJ captures tax on property gains from sellers who leave the state and might never file a NJ return.
The withholding equals the greater of 10.75% of the estimated gain (using the highest GIT rate under N.J.S.A. 54A:2-1) or 2% of the total consideration stated in the deed. This is not a choice between two options. The 2% is a statutory minimum floor. Even sellers with no gain must pay the 2% minimum and seek a refund afterward, unless they qualify for an exemption or obtain a GIT/REP-4 waiver.
The 10.75% withholding rate is the highest marginal bracket, not the effective rate. Most sellers owe far less in actual NJ income tax because the graduated GIT brackets start at 1.4%. The difference between what is withheld at closing and what is actually owed is refunded when the seller files NJ-1040NR. Refunds typically take 4 to 12 weeks after filing.
NJ conforms to the federal Section 121 principal-residence exclusion per N.J.S.A. 54A:6-9.1. If you owned and used the property as your primary residence for at least 2 of the last 5 years, you can exclude up to $250,000 of gain (single) or $500,000 (married filing jointly). If the property qualifies as a principal residence under Section 121, you file GIT/REP-3 (Box 2) at closing with no withholding required.
If your gain exceeds the exclusion, current GIT/REP-3 instructions still allow Box 2 for a qualifying principal residence. Make an estimated payment via NJ-1040-ES for the taxable portion after recording, then reconcile it on NJ-1040NR.
NJ residents file GIT/REP-3 (Box 1) and owe no estimated payment at closing. Entities (corporations, partnerships, LLCs) file GIT/REP-3 (Box 5). The GIT/REP-3 form includes 16 exemption boxes covering scenarios from principal residence sales to 1031 exchanges, foreclosures, divorce transfers, and military deployments. Sellers with a capital loss who do not qualify for any exemption box can apply for a GIT/REP-4 waiver at least 14 days before closing.
Part-year residents are treated as nonresidents for GIT/REP purposes. If you move out of NJ on or after the day of transfer, you cannot check Box 1. A seller who closes on their NJ home on the same day they leave the state is treated as a nonresident for the GIT/REP filing.
Single filer moving from NJ to South Carolina. Home purchased in 2005 for $100,000, $50,000 in documented improvements, sold in 2026 for $500,000. Primary residence for 10+ years. The Section 121 exclusion ($250,000 single) covers most but not all of the gain, so the taxable excess still needs an estimated payment and NJ-1040NR reporting.
| Step | Amount |
|---|---|
| Sale price | $500,000 |
| Cost basis ($100,000 + $50,000 improvements) | $150,000 |
| Gross gain | $350,000 |
| Section 121 exclusion (single) | ($250,000) |
| Taxable gain | $100,000 |
| GIT/REP-3 Box 2 withholding at closing | $0 |
| Estimated NJ tax on $100,000 taxable gain | ~$4,180 |
| Suggested NJ-1040-ES payment after recording | ~$4,180 |
The planning point: GIT/REP-3 Box 2 can still be used for a qualifying principal residence even when the gain exceeds the Section 121 exclusion. The taxable excess is not forgiven; it should be covered with an NJ-1040-ES estimated payment after recording and reconciled on NJ-1040NR.
Mitigation: If you are still a NJ resident, time the sale to close before you move so you can file GIT/REP-3 Box 1 instead. The actual NJ tax owed is the same either way - it just gets paid through estimated payments and your NJ-1040NR instead of being held up as a large closing-table prepayment for several months.
If withholding has already happened: File Form A-3128 the day the deed is recorded if the payment clearly exceeds your actual NJ liability. Refunds typically arrive in 6-8 weeks; faster if you e-file NJ-1040NR.
The 2026 NJ exit tax withholding uses 10.75% (NJ's highest GIT rate) applied to the estimated gain, with a 2% of total sale price minimum floor. Many older sites incorrectly cite 8.97%; that rate has been outdated since 2020 when NJ added the 10.75% bracket (P.L. 2020, c.118).
No. NJ residents who will remain in-state after closing file GIT/REP-3 Box 1 and owe nothing at closing. Residency is determined on the day of closing, so closing before you move out of state eliminates the withholding entirely.
File Form A-3128 (Claim for Refund of Estimated Gross Income Tax Payment) immediately after the deed is recorded for a 6-8 week refund. Alternatively, claim the overpayment on your NJ-1040NR for the tax year of the sale. NJ does not pay interest on GIT/REP refunds.
Yes. NJ conforms to IRC Section 121. GIT/REP-3 Box 2 applies to qualifying principal residences. If the gain exceeds the Section 121 exclusion, the taxable excess is still reportable and can be paid after recording with NJ-1040-ES, then reconciled on NJ-1040NR.
They are separate obligations. The exit tax is an estimated income tax prepayment on capital gains. The mansion tax (restructured by P.L. 2025, c.69 effective July 10, 2025) is a Realty Transfer Fee surcharge now paid by the seller on deeds over $1 million, with rates from 1% to 3.5% depending on sale price.
Yes, in most cases. Even with no taxable gain, the 2% minimum withholding applies to the total consideration. A $400,000 property sale at a loss still owes $8,000 at closing. The seller can apply for a GIT/REP-4 waiver with documented proof of the capital loss (submit at least 14 days before closing), or pay the 2% and claim the full refund on NJ-1040NR.
IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, I inform you that any U.S. federal tax advice contained herein is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein.