Selling in Greenwich comes with many moving parts, and the conveyance tax is one of the most misunderstood. You want a clear picture of what you will owe, when it is due, and how it affects your bottom line. This guide gives you a plain-English walkthrough so you can plan your sale with confidence and avoid surprises at the closing table. Let’s dive in.
Conveyance tax basics
A conveyance tax is a government tax on the transfer of real property. It is typically calculated as a percentage of the sale price and is collected when the deed is recorded. In Connecticut, there are two layers to know: a state conveyance tax and, in many towns, a municipal conveyance tax. Greenwich sellers should account for both when estimating closing costs.
Who pays in Connecticut
In Connecticut, the seller usually pays the conveyance tax at closing. The purchase contract can allocate costs differently, so the parties can negotiate. Your title company or closing attorney will calculate the exact amount, collect it from your funds at closing, and handle the filing and remittance.
State vs. Greenwich municipal tax
Every Greenwich sale involves a state conveyance tax. Greenwich also imposes a local municipal conveyance tax. The municipal rate and how it applies are set by the Town of Greenwich. Because rates and structures can change, confirm the current state schedule with the Connecticut Department of Revenue Services and the local rate with the Town Clerk or Tax Collector before you finalize numbers.
When the tax is paid
The conveyance tax is due at or just before the deed is recorded. In practice, it is handled at closing by your title company or closing attorney. You will see the tax on your closing disclosure, and the settlement agent will remit payment and file the required forms on your behalf.
How the tax is calculated
Conveyance tax is based on the sale price and the applicable rates. Some transactions are illustrated with a single combined percentage for simplicity. In other cases, the state schedule may be progressive, which means different portions of the price are taxed at different rates. Because Greenwich often sees higher price points, the presence of progressive bands can materially affect your total tax.
Illustrative flat-rate examples
The examples below use an assumed combined rate of 1.00% for easy math, with an illustrative split of 0.75% state and 0.25% municipal. These are for illustration only. Always confirm current state and Greenwich rates before making decisions.
- At $1,000,000, estimated conveyance tax at 1.00% would be $10,000.
- At $2,500,000, estimated conveyance tax at 1.00% would be $25,000.
- At $5,000,000, estimated conveyance tax at 1.00% would be $50,000.
- At $10,000,000, estimated conveyance tax at 1.00% would be $100,000.
These examples show how the tax scales linearly when you apply a single percentage. Your actual amount may differ once you apply the current state schedule and the exact local rate.
Illustrative progressive example
To show how a banded schedule can change your total, here is a hypothetical state schedule purely for illustration. Do not rely on these bands for a real transaction. Verify the current schedule with the Connecticut Department of Revenue Services.
- 0.75% on the first $1,000,000
- 1.25% on the portion from $1,000,001 to $3,000,000
- 1.75% on the amount over $3,000,000
Example at a $3,000,000 sale price using that hypothetical schedule:
- First $1,000,000 at 0.75% = $7,500
- Next $2,000,000 at 1.25% = $25,000
- Hypothetical state subtotal = $32,500
- If you add an illustrative municipal 0.25% on the full $3,000,000, that is $7,500, for a combined illustrative total of $40,000.
Again, these figures are examples. Your title company or closing attorney will apply the actual current state schedule and the Greenwich municipal rate to calculate your exact tax.
How the tax affects net proceeds
Conveyance tax is just one part of your selling costs. To see the impact, it helps to sketch a simple net proceeds estimate. Below is an illustrative example that excludes mortgage payoff and prorations.
- Sale price: $3,000,000
- Agent commission at 5% (example only): $150,000
- Conveyance tax at 1.00% combined (illustrative): $30,000
- Attorney, title, and recording fees (illustrative): $5,000
- Estimated net proceeds: $2,815,000
This is a simplified view. Your final number will change based on your mortgage payoff, property tax prorations, repairs or credits, and the exact tax and fee amounts. Ask your title company or attorney for an estimated closing disclosure so you can plan with precision.
Common exemptions and special cases
Several transfer types may be exempt from conveyance tax, subject to statutory requirements and documentation. Examples can include transfers between spouses, transfers incident to divorce, certain transfers involving governmental bodies or qualified charities, and some estate-related transfers. Special rules may also apply to gifts, partitions, and foreclosure sales. Review your situation with your closing attorney to confirm whether any exemption applies and what paperwork is required.
Other seller costs in Greenwich
Beyond the conveyance tax, you should budget for these common items:
- Real estate commission. Often the largest single line item, and typically negotiated in the listing agreement.
- Attorney and title services. Legal, title search, title insurance, and recording fees vary by firm and complexity.
- Mortgage payoff. Include any principal, interest through closing, and possible prepayment penalties.
- Property tax proration. You usually pay your share up to the closing date, and the buyer takes over after closing.
- Potential income taxes on gains. Federal and state income taxes are separate from conveyance tax. If you expect a large gain, speak with a tax advisor about exemptions and planning.
Negotiation and planning tips
- Allocate costs in the contract. While sellers typically pay the conveyance tax in Connecticut, cost allocations are negotiable. Know your leverage and the market.
- Price with net in mind. Build the conveyance tax into your pricing and net sheet so you are not surprised at closing.
- Use a detailed estimate early. Ask your title company or closing attorney for a draft closing disclosure once you have an accepted offer.
- Time your move. Property tax proration and rate changes can affect your net. Coordinating your closing date can matter.
Greenwich seller checklist
- Confirm the current state conveyance tax schedule with the Connecticut Department of Revenue Services.
- Confirm the Greenwich municipal conveyance tax rate and filing process with the Town Clerk or Tax Collector.
- Ask your listing broker or title company for an estimated closing disclosure that shows state and municipal conveyance taxes, all fees, and your estimated net proceeds.
- Review possible exemptions with your closing attorney to see if any apply to your transfer.
- If you expect a significant gain, consult a tax advisor about federal and state income tax implications.
- Keep the conveyance tax in your net proceeds sheet and pricing conversations from day one.
Work with a local expert
Getting your conveyance tax right is essential to a smooth closing and a successful sale. You deserve a partner who brings deep Greenwich experience, coordinated legal and title support, and a clear plan to protect your net. As a seasoned, full-service team with concierge-level marketing and strong negotiation, we can help you price, prepare, and sell with confidence. Connect with The Rosato Team to get a tailored plan and Get Your Home Valuation.
FAQs
What is Greenwich conveyance tax and who pays it?
- In Connecticut, conveyance tax is a tax on the transfer of real property, and sellers typically pay it at closing, though cost allocation can be negotiated in the contract.
How do state and Greenwich municipal taxes work together?
- Your total conveyance tax includes a state component and, in Greenwich, a municipal component, both calculated from the sale price using the current rates in effect at closing.
When is the conveyance tax due for a Greenwich sale?
- The tax is collected at closing and remitted when the deed is recorded, handled by your title company or closing attorney as part of the settlement process.
Do any transfers qualify for conveyance tax exemptions in Connecticut?
- Certain transfers, such as between spouses, incident to divorce, or involving qualified governmental or charitable entities, may be exempt subject to documentation and statutory rules.
How do higher-priced Greenwich homes affect the tax owed?
- If the state schedule uses progressive bands, higher portions of your sale price can be taxed at higher rates, which increases the total tax compared with a flat rate.
Can a buyer agree to pay the seller’s conveyance tax in a Greenwich deal?
- Yes, the parties can negotiate who pays in the purchase contract, although the default practice in Connecticut is for the seller to pay it.
How can I estimate my net proceeds including conveyance tax?
- Ask your title company or attorney for an estimated closing disclosure that includes state and municipal conveyance taxes, commissions, fees, prorations, and your mortgage payoff to show your expected net.
