What Sellers Need to Know About the Connecticut Real Estate Conveyance Tax

When preparing to sell a home in Connecticut, most homeowners focus on pricing, staging, marketing, and planning their next move. But one significant cost often catches sellers off guard: the Connecticut Real Estate Conveyance Tax. This tax is due at closing and must be paid to both the State of Connecticut and your local municipality before the sale is finalized. While it's not a new tax, it’s one that many sellers underestimate — and it can make a noticeable impact on your net proceeds.

The conveyance tax in Connecticut is divided into two parts: a state tax and a municipal (town) tax. Both are calculated based on the final sale price of your home and are typically paid by the seller at closing. These taxes are required in order to legally transfer the deed to the buyer. Since they’re not included in your real estate commission or legal fees, they need to be factored into your financial planning ahead of listing your home.

State Tax Rates

The state conveyance tax is tiered based on the sale price:

• The first $800,000 is taxed at 0.75%
• The amount between $800,001 and $2,500,000 is taxed at 1.25%
• Anything above $2,500,000 is taxed at 2.25%

For example, if you sell your home for $1,000,000, the first $800,000 would be taxed at 0.75% ($6,000), and the remaining $200,000 would be taxed at 1.25% ($2,500), for a total state tax of $8,500.

Municipal Tax Rates

In addition to the state tax, your town will also charge a municipal conveyance tax. Most towns, including Fairfield, Easton, and Weston, charge 0.25% of the sale price. However, towns designated as "targeted investment communities" — such as Stamford, Norwalk, and Bridgeport — can charge up to 0.50%.

So, if you're selling a home in Fairfield for $800,000, the municipal tax would be 0.25% of the sale price, or $2,000. When combined with the state tax, this brings your total conveyance tax to $8,000 — separate from other selling expenses like commissions and legal fees.

Are There Any Exemptions?

Some property transfers may be exempt from the conveyance tax. These include transfers between spouses, transfers resulting from divorce, foreclosures, or certain sales to nonprofit organizations. However, in the vast majority of standard home sales, the tax applies and should be budgeted for accordingly.

The Real Cost of Selling

Many sellers are surprised to learn just how much they owe in taxes when they sell. It’s easy to overlook during the excitement of preparing to list, but the conveyance tax is just one part of the total cost of selling. When you factor in real estate commissions, attorney fees, possible home repairs or staging, moving expenses, and this tax, your final profit can shift quickly. That’s why understanding every cost involved is so important — especially if you're relying on those proceeds to purchase your next home.

The Connecticut conveyance tax is a key part of the selling process, and one that shouldn’t be overlooked. As a seller, it’s important to plan ahead so there are no surprises at the closing table. A knowledgeable real estate agent can help you estimate your true net proceeds, taking all costs into account — including this tax — so you can make confident, informed decisions.

If you're looking to buy or sell in Fairfield County, I’d be happy to walk you through what to expect and help you prepare every step of the way.