NJ Affidavit of Consideration: RTF-1 Fees, Exemptions, and Filing

In New Jersey, the Affidavit of Consideration is Form RTF-1, a sworn statement the seller attaches to the deed at recording to document the sale price, the property’s tax classification, and any exemption claimed from the Realty Transfer Fee. Without it, in the situations that require it, the county clerk will not record the deed.

When the RTF-1 Is Required

The affidavit must accompany the deed in four situations: when the full consideration is not stated in the deed itself, when the seller claims a full or partial exemption from the Realty Transfer Fee, when the property is Class 4 (commercial, industrial, or apartment), and when the transfer involves new construction.¹ In everyday practice, most residential closings include one anyway, because attorneys and title companies attach it as a matter of course to keep recording moving.

Transfers where no money changes hands still often need the form. A conveyance between spouses, from a parent to a child, or as part of a corporate reorganization may be exempt from the Realty Transfer Fee, but the seller has to file the RTF-1 to establish that.² Writing “exempt” on the deed does not do the job. The form calls for a written explanation of the basis for the exemption.¹

The Realty Transfer Fee itself applies to every conveyance of title to real property in New Jersey unless the deed meets a statutory exemption. It is imposed on the seller and calculated on the consideration stated in the deed, and it does not apply when total consideration is less than $100.²

What Goes on the Form

The RTF-1 asks for more than a sale price. “Consideration” is defined as the entire compensation paid or to be paid for the transfer. That includes the purchase price, any remaining mortgage balance the property is transferred subject to, assumed mortgages, liens, and any other encumbrances not paid off at closing.¹ Understating consideration to reduce the fee is one of the fastest ways to draw an audit.

The affidavit must also identify the property by block and lot, municipality, and county.³ The description has to match the deed exactly; a mismatch will get both documents kicked back at the clerk’s window.

The seller identifies the property’s tax classification on the form. For Class 4A commercial property, there is an additional section for calculating the equalized assessed value. When any exemption is claimed, full or partial, the corresponding section requires a written explanation of the basis, not just a checked box.¹

Who Signs

The affidavit must be signed by one or more parties named in the deed or by their legal representative. The form defines legal representative broadly: an attorney for either party, a title company closing officer, a lending institution closing officer, or anyone holding power of attorney from the grantor or grantee.¹ When a corporate officer signs for an entity, the form must include the corporation’s name and the officer’s title.

Notarization

The completed RTF-1 must be subscribed and sworn before a notary public or other officer authorized to administer oaths. The notary signs the acknowledgment and prints their name, title, and jurisdiction. Without proper notarization, the clerk will reject the filing and the deed will not be recorded. New Jersey caps notary fees at $2.50 per acknowledgment.⁴

How the Fee on the Form Is Calculated

The Realty Transfer Fee runs on a graduated schedule, and which schedule applies depends on whether the total consideration is over $350,000. That cutoff matters, because crossing it pushes every bracket, including the lowest, into a higher rate.

Consideration of $350,000 or Less

First $150,000: $2.00 per $500
$150,001 to $200,000: $3.35 per $500
$200,001 to $350,000: $3.90 per $500⁵

Consideration Over $350,000

First $150,000: $2.90 per $500
$150,001 to $200,000: $4.25 per $500
$200,001 to $550,000: $4.80 per $500
$550,001 to $850,000: $5.30 per $500
$850,001 to $1,000,000: $5.80 per $500
Over $1,000,000: $6.05 per $500⁵

A sale at $340,000 produces an RTF of roughly $1,330. A sale at $360,000 falls into the higher table across the board and produces roughly $2,300. Sellers near the $350,000 line should look closely at the number they put on the affidavit.

The Additional Fee on Sales Over $1 Million

High-value transfers trigger a separate additional fee, often called the mansion tax, imposed on the seller on top of the standard RTF. It was once a flat 1% paid by the buyer; the law now imposes a graduated rate on the grantor that applies to the entire consideration, not just the amount above $1 million:³

Over $1 million and up to $2 million: 1%
Over $2 million and up to $2.5 million: 2%
Over $2.5 million and up to $3 million: 2.5%
Over $3 million and up to $3.5 million: 3%
Over $3.5 million: 3.5%

A $1.5 million sale generates $15,000 in mansion tax on top of the standard RTF. A $4 million sale generates $140,000. The additional fee applies to residential property, farm property that includes a residential building, cooperative units, and Class 4A commercial property.³ Tax-exempt organizations under the Internal Revenue Code are not subject to it when they are the buyer.⁵ For any transfer subject to this additional fee, the affidavit must clearly state the total consideration, county, municipality, and block-and-lot.

Full and Partial Exemptions

Some transfers are fully exempt from the Realty Transfer Fee. The most common are transfers where consideration is less than $100, conveyances between spouses, and transfers from parent to child.² Even so, the seller still files the RTF-1 and still has to explain in detail why the exemption applies. A citation to the exemption code alone will not do.¹

Partial exemptions reduce the rate rather than eliminate it. They apply to transfers by qualifying senior citizens (age 62 or older), blind persons, disabled persons, and transfers of low- and moderate-income housing. The reduced schedule is substantially lower. On a sale of $350,000 or less, the first-tier rate drops from $2.00 per $500 to $0.50 per $500.⁵ A partial-exemption claim also uses the RTF-1, notarized and recorded with the deed.

One limit worth knowing: the partial exemption for seniors, blind persons, and disabled persons is personal to the individual seller. An estate, a trust, or another legal entity cannot claim it on the seller’s behalf.⁵ The exemption also reaches only the residential portion of a mixed-use property. If a sale includes both a home and commercial space, only the residential share of the price qualifies for the reduced rate.

Filing the Affidavit

The completed RTF-1 is filed with the county clerk or register of deeds in the county where the property sits, and it must be submitted in duplicate. If a property straddles county lines, the deed and affidavit are recorded in each county. In the second county, the affidavit must reference the earlier recording by county, book, page number, date, and amount of Realty Transfer Fee already paid, so the fee is not charged twice.¹

Forms That Travel With the RTF-1

The affidavit is not the only document the county clerk needs. New Jersey law requires a GIT/REP form (Gross Income Tax) with every deed transfer.⁶ The GIT/REP addresses whether the seller owes estimated New Jersey income tax on the gain. The most common variant, the GIT/REP-3, certifies either that the seller is a New Jersey resident or that a statutory exemption from the estimated tax payment applies.⁷ If the GIT/REP-3 is not fully completed and submitted, the clerk will not record the deed. Nonresident sellers who do not qualify for an exemption make an estimated income tax payment at closing, and choosing the wrong variant among GIT/REP-1, -2, -3, -4, and -4A can delay recording.

When a foreign person or entity sells New Jersey real estate, federal law adds another layer. Under the Foreign Investment in Real Property Tax Act, the buyer must generally withhold 15% of the sale price and remit it to the IRS unless the seller provides a sworn certification of non-foreign status.⁸ That certification is separate from the RTF-1 but often shows up at the same closing table.

If the Affidavit Is Missing, Wrong, or Underreported

If the RTF-1 is missing, incomplete, or miscalculated, the county clerk refuses to record the deed. An unrecorded deed keeps the buyer’s ownership out of the public record. Mortgage lenders want a recorded deed before finalizing financing, title insurance coverage depends on timely recording, and any lien or claim that attaches during the gap between closing and recording can jump ahead of the buyer’s interest.

Financial exposure escalates from there. The Division of Taxation can audit transactions and assess the correct fee plus interest when it finds underpayments. New Jersey’s statute on false affidavits of consideration addresses falsifying the consideration amount and failing to disclose new construction.⁹ Even where a deed is recorded despite an incorrect payment, the seller remains personally liable to the county recording officer for the proper amount.¹⁰ The recording is not invalidated and title stays marketable, but the unpaid fee becomes a debt the seller cannot walk away from.

Where a sworn statement was intentionally false, the exposure goes beyond back taxes and interest to potential civil liability and criminal charges under New Jersey’s fraud statutes, and anyone who helped prepare or submit a fraudulent affidavit may face suits from parties harmed by it.

Correcting an Affidavit After Recording

Errors can be fixed, but the fix takes a new document rather than marks on the old one. To amend a filed RTF-1, prepare a corrected affidavit that references the original filing by county, book, page number, and date of recording.¹ The corrected version has to be signed and notarized again, like the original. Some county clerks want a cover letter or formal correction request explaining what changed.

If the correction changes the fee calculation, the seller pays the shortfall or requests a refund for an overpayment. Where the original contained materially false information that produced an underpayment, the Division of Taxation may require an amended return along with the outstanding balance and interest. Catching the error first is cheaper than having the Division catch it.

1
NJ.gov. State of New Jersey Affidavit of Consideration for Use by Seller
2
NJ Division of Taxation. Realty Transfer Fee
3
Justia. New Jersey Code Title 46 – Section 46-15-7.2 Additional Fee on Certain Transfers of Real Property Over 1,000,000
4
NJ.gov. New Jersey Notary Public Program Frequently Asked Questions
5
NJ.gov. Realty Transfer Fees Frequently Asked Questions
6
NJ.gov. FAQs on GIT Forms Requirements
7
NJ.gov. GIT/REP-3 Sellers Residency Certification/Exemption
8
Internal Revenue Service. FIRPTA Withholding
9
Justia. New Jersey Code Title 46 – Section 46-15-9 Falsifying Consideration, Failure to Disclose New Construction on Deed and Affidavits – Penalty
10
Justia. New Jersey Code Title 46 – Section 46-15-7 Realty Transfer Fees