Connecticut’s Real Estate Conveyance Tax: What Sellers Actually Owe in 2026

Connecticut sellers owe a real estate conveyance tax at closing, made up of a tiered state tax ranging from 0.75% to 2.25% plus a municipal tax of 0.25% to 0.5%, and by state law the seller, not the buyer, is legally responsible for paying it. On a typical $400,000 home, that works out to roughly $4,000 in combined conveyance tax due the moment the deed is recorded. Here’s exactly how the tiers work and what changes above $2.5 million.

Table of Contents

1. Who Actually Pays Connecticut’s Conveyance Tax?
2. How Do the State Tax Tiers Work?
3. What About the Municipal Portion?
4. A Worked Example
5. What Changes Above $2.5 Million?
6. How Does a Cash Sale Fit Into This?
7. FAQ

Who Actually Pays Connecticut’s Conveyance Tax?

By Connecticut law, the grantor, meaning the seller, is the party legally liable for the real estate conveyance tax. Payment is due at the moment the deed is presented to the town clerk for recording, alongside a completed Form OP-236, Connecticut Real Estate Conveyance Tax Return, filed with the state Department of Revenue Services.

This is a closing-day obligation, not something that shows up later on an income tax return, which is why it’s important to budget for it before you set your asking price.

How Do the State Tax Tiers Work?

Connecticut’s state conveyance tax is tiered based on the sale price, under rates established by Public Act 19-117 (effective July 1, 2020):

• 0.75% on the portion of the sale price up to $800,000
• 1.25% on the portion between $800,000 and $2,500,000
• 2.25% on the portion above $2,500,000

This is a true marginal structure, meaning each tier only applies to the slice of the price that falls within it, not the entire sale price at the highest applicable rate.

What About the Municipal Portion?

On top of the state tax, every Connecticut town or city charges its own conveyance tax, standard at 0.25% of the sale price. Certain “targeted communities” have adopted a local option allowing them to charge double that rate, 0.5%, so it’s worth confirming your specific town’s rate with your closing attorney before you finalize your numbers.

A Worked Example

Consider a $1,000,000 sale in a town charging the standard 0.25% municipal rate:

• State tax: $800,000 × 0.75% = $6,000, plus $200,000 × 1.25% = $2,500, for a state total of $8,500
• Municipal tax: $1,000,000 × 0.25% = $2,500
• Total conveyance tax: $11,000

In a targeted community charging the higher 0.5% municipal rate, that same sale would owe $13,500 in total, per the Connecticut DRS rate structure.

What Changes Above $2.5 Million?

Here’s a detail most sellers never hear about. For the portion of a residential sale price above $2,500,000, Connecticut DRS’s own Schedule CT-1040 REC instructions describe an income tax credit tied to that top tier: taxpayers can calculate 1% of the consideration above $2,500,000, multiply that figure by 33.3%, and claim the result as a credit against their Connecticut income tax liability for that year, with any unused portion carried forward.

In plain terms, a portion of what high-value Connecticut sellers pay in conveyance tax on the amount above $2.5 million can come back to them through their state income tax return, provided they file the correct schedule. This doesn’t reduce what’s due at closing, but it’s a meaningful detail for anyone selling a higher-value Connecticut home to bring to their accountant.

How Does a Cash Sale Fit Into This?

Connecticut’s conveyance tax applies the same way whether you sell traditionally or for cash, since it’s based on sale price and town, not on how the buyer pays. What a cash sale changes is the certainty of the rest of the transaction: no financing contingency, no appraisal risk, and a closing that can happen in one to two weeks instead of waiting out a traditional listing.

Knowing your conveyance tax number ahead of time, whichever way you sell, means no surprises when the closing statement arrives.

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Frequently Asked Questions About Connecticut’s Conveyance Tax

Does the buyer or seller pay Connecticut’s conveyance tax? The seller. Connecticut law places legal responsibility for the real estate conveyance tax on the grantor, due at the time the deed is recorded.

What are the current state conveyance tax rates? 0.75% on the portion of the sale price up to $800,000, 1.25% between $800,000 and $2,500,000, and 2.25% above $2,500,000, under rates set by Public Act 19-117.

Is there a separate municipal tax too? Yes. Every Connecticut town charges its own conveyance tax, standard at 0.25% of the sale price, with certain targeted communities authorized to charge 0.5%.

Is there any relief for sellers on homes over $2.5 million? Connecticut DRS’s Schedule CT-1040 REC allows a state income tax credit equal to 33.3% of the 1% tax on the portion of a residential sale above $2,500,000, claimed on the seller’s income tax return.

Does selling for cash reduce the conveyance tax owed? No. The tax is based on sale price and municipality, not on how the buyer pays. A cash sale can simplify and speed up the rest of the transaction, but it doesn’t change the tax calculation.