New mansion tax to impact Los Angeles real estate deals
Los Angeles will be applying a new mansion tax on commercial and residential real estate transactions that exceed $5 million starting from April 1. There will also be an extra documentation transfer tax determined by the property’s gross sale price, instead of adjusting the existing documentary transfer tax.
The documentary transfer tax for Los Angeles is $4.50 per $1,000 until March 31, the Real Property Transfer Tax rate is 0.45 percent and will remain unchanged, and there will be Measure ULA Rate that is dependent on the amount of the transaction.
The tax rate for properties sold for over $5 million but under $10 million will be four percent, and for real estate transactions involving commercial and residential properties worth $10 million or more will be 5.5 percent.
The documentary transfer tax is set to be imposed on all documents that convey real property in Los Angeles cities. The tax is calculated when consideration or value of the interest or property conveyed is over $100, with a rate of $0.55 for each $500.