New MA Withholding Rule for $1M+ Boston Home Sales

On a Massachusetts home sale of $1,000,000 or more, every seller must give the closing attorney a signed Transferor's Certification by closing, or 4 percent of the gross sales price is withheld and sent to the state. Most Boston sellers above that line will have nothing withheld, but only if the exemption is claimed on the form.

Does Massachusetts hold back money from your home sale if the price is over $1 million?

It can. For closings on or after November 1, 2025, Massachusetts requires the closing attorney (the "withholding agent") to file a Form NRW with the Department of Revenue on every real estate sale with a gross sales price of $1,000,000 or more. Every seller in that transaction has to provide a signed Transferor's Certification on or before closing. If no certification is provided, the attorney must withhold 4 percent of the gross sales price and send it to the state, even if the seller is a lifelong Massachusetts resident who owes nothing.

That is the part that catches people. Most Boston sellers who cross the $1 million line will have nothing withheld. But the exemption is not automatic. It has to be claimed, in writing, on a state form, before the deed changes hands.

Key Takeaways

• For closings on or after November 1, 2025, a Form NRW is filed with the Department of Revenue on every sale with a gross sales price of $1,000,000 or more.
• Without a signed Transferor's Certification, the default withholding is 4 percent of the gross sales price, not your profit.
• Full-year Massachusetts residents are generally exempt from the withholding, but they still must provide the certification.
• Nonresident sellers can elect the alternative calculation: 5 percent of estimated net gain for an individual, plus the surtax add-on above $1,107,750 in 2026.
• The threshold is measured on the sale price, not each seller's share, so every co-owner of a $1.6 million building must certify.

What paperwork is required for a $1 million home sale in Massachusetts?

A Transferor's Certification from every seller and a Form NRW filed by the closing attorney. Here's how the rule works in practice.

Under the Department of Revenue's regulation, 830 CMR 62B.2.4, the withholding agent has two jobs on any sale of $1,000,000 or more:

1. Collect a completed Transferor's Certification from every seller, on or before the closing.
2. File Form NRW with the DOR electronically within 10 days of closing, with each seller's certification attached, and send any amount withheld.

The Form NRW gets filed either way. Even when no withholding is due, the return still goes in, and the certification is what shows that.

Now the part that costs money. Without a certification, the default is withholding on the gross sales price. Not on your profit. Not on your equity. On the full sale price.

As an example, on a $1.4 million sale by one individual seller, 4 percent of gross is $56,000. The surtax add-on (another 4 percent on the $292,250 above the 2026 surtax threshold of $1,107,750) adds $11,690, for a total of about $67,700 held back at closing. You can get back what you don't owe, but only after you file your Massachusetts return for that tax year. That can mean months of your money sitting with the state because a form didn't make it into the file. Your closing attorney will confirm the exact calculation for your sale.

Juan Murray has walked many sellers through Massachusetts closing paperwork over the years, and this is the newest item on the list that sellers often don't see coming.

Who has money withheld on a Massachusetts home sale, and how much?

Mainly nonresident individuals and corporations without a continuing Massachusetts business presence.

The withholding itself is aimed at nonresidents. If you moved out of your Boston home, relocated to another state, and are now selling the property, you are the taxpayer this regulation was written for.

Sellers who are generally exempt from the withholding (but who still must provide the certification):

• Full-year Massachusetts residents
• Estates of resident decedents and resident trusts
• Pass-through entities, such as partnerships and S corporations
• Corporations with a continuing Massachusetts business presence
• 501(c)(3) organizations, unless the sale produces unrelated business taxable income
• Certain financial institutions, insurance companies, and government bodies

Sellers who typically do face withholding:

• Individuals who are not Massachusetts residents
• Corporations without a continuing Massachusetts business presence

If you are in the second group, there are two ways the number gets calculated:

The default. Four percent of the gross sales price. For an individual whose amount exceeds the state's surtax threshold, an additional 4 percent applies to the amount above that threshold. For tax year 2026, the surtax threshold is $1,107,750.

The alternative calculation. You can elect to have withholding based on your estimated net gain instead: 5 percent for an individual (plus the additional 4 percent above the surtax threshold) or 8 percent for a corporation. Estimated net gain is your gross price minus your estimated adjusted basis and settlement-related expenses, and you'll need documentation such as your purchase price, improvements, and closing costs.

For many longtime owners, the alternative calculation produces a much smaller number, because it's built on gain rather than price. But it is not the default. You have to elect it on the Transferor's Certification.

Withholding can also be reduced or eliminated in certain situations, including when the withholding would exceed what's left after paying off your mortgage, a foreclosure where the price doesn't exceed the secured debt, certain involuntary conversions, a like-kind exchange to the extent gain is deferred (see 1031 exchanges for Boston investment property), and installment sales. Each has to be claimed on the certification, so ask your closing attorney which, if any, fit your sale.

Does the $1 million withholding rule apply when several heirs sell a multi-family?

Yes, if the gross sales price is $1,000,000 or more.

The $1,000,000 threshold is measured by the gross sales price of the sale, not by what each seller receives.

This matters in Dorchester, Roxbury, and Jamaica Plain, where inherited two-families and triple-deckers are often owned by several siblings. Say four heirs sell a building for $1.6 million. Each one receives roughly $400,000, but the sale price is still above $1,000,000, so the rule applies. Every seller must provide a certification, including each spouse when a married couple holds title together.

That is a real coordination problem when one heir lives in Boston and another has lived out of state for a decade. The out-of-state sibling may face actual withholding while the local ones don't, and every certification has to be in the attorney's hands by closing, not after.

If you're already working through an inherited home sale in Massachusetts, add this to the checklist early. Chasing signatures the week of closing is how deals slip.

Which Boston neighborhoods have home sales over $1 million?

Typical multi-family sales in Jamaica Plain, Dorchester, Roxbury, and Roslindale, and typical Jamaica Plain single-family sales.

A $1 million threshold is not just a downtown issue. MLS PIN sales data for September 2025 through August 2026 show these medians:

• Jamaica Plain (02130): single-family $1,435,000; multi-family $1,430,000; condo $768,750
• Dorchester (02121, 02122, 02124, 02125 combined): multi-family $1,200,000
• Roxbury (02119): multi-family $1,030,000
• Roslindale (02131): multi-family $1,025,000; single-family $800,500
• Hyde Park (02136): multi-family $943,750; single-family $661,000

In other words, a typical multi-family sale in Jamaica Plain, Dorchester, Roxbury, or Roslindale, and a typical Jamaica Plain single-family sale, now lands above $1 million. Condo sales and most single-family sales in Roslindale and Hyde Park still land below it.

If your sale price starts with a 1, this rule is part of your closing, and it belongs in your net sheet conversation before you list, not in the attorney's email the week of the closing.

A few things worth knowing about how this fits with everything else:

• This is not a new tax. It is a prepayment mechanism. It doesn't change what you owe, only when the state collects it.
• It is separate from the Massachusetts deed excise tax, the "tax stamps" of $4.56 per $1,000 of sale price. Both can appear on the same settlement statement.
• It is also separate from Boston's proposed transfer fee, which is not law.
• What you actually owe in state tax on the sale is a different calculation. For many owner-occupants, the federal home sale exclusion under IRC Section 121 (up to $250,000 of gain, or $500,000 for qualifying married couples filing jointly), which Massachusetts follows, does much of the work. See capital gains tax when selling a home in Massachusetts.

This is a solvable problem. It only becomes expensive when nobody raises it until closing week. Bring it up with your listing agent and your closing attorney early, get the certification prepared, and decide whether the alternative calculation makes sense for you. Residency, how title is held, and which certification options fit your sale depend on your own facts, so talk with a CPA or tax advisor before you sign.

FAQ

I have lived in Jamaica Plain for 30 years. Do I still have to fill out the Transferor's Certification?

Yes. Full-year Massachusetts residents are exempt from the withholding itself, but you claim the exemption on the certification and give it to your closing attorney on or before closing. Without it, the attorney must withhold at the default rate of 4 percent of the gross sales price.

I moved out of Massachusetts but still own my Boston house. How much gets withheld?

If the gross sales price is $1,000,000 or more, the default is 4 percent of the gross price, plus an additional 4 percent on any amount above the 2026 surtax threshold of $1,107,750. You can elect the alternative calculation on the certification, which withholds 5 percent of your estimated net gain instead (plus the surtax add-on above the threshold). For many longtime owners that number is far lower, but you have to elect it.

Does this apply if my house sells for $950,000?

No. The filing and withholding rules apply at a gross sales price of $1,000,000 or more. The threshold is measured on the sale price, not on each seller's share of the proceeds.

We are three siblings selling our parents' Dorchester triple-decker. What do we each need to do?

Each seller needs to provide a Transferor's Certification. If the estate itself is the seller and the decedent was a Massachusetts resident, the estate is generally exempt from withholding, but the certification is still required. If any of you takes title individually first and one of you lives out of state, that sibling may face actual withholding, so sort out how title will be held well before the closing date.

When do I get the withheld money back?

You reconcile it when you file your Massachusetts income tax return for the year of the sale (Form 1-NR/PY for nonresidents and part-year residents). If more was withheld than you owe, you can receive the difference as a refund. The Department of Revenue sends an NRW statement the following January.

The bottom line: if your sale price is $1,000,000 or more, get every seller's Transferor's Certification to your closing attorney before closing so nothing is withheld that you don't owe.

Sources

• Goulston & Storrs, New Withholding Requirements for Non-Resident Sellers of Massachusetts Real Estate (Oct. 28, 2025): https://www.goulstonstorrs.com/insights/article/new-withholding-requirements-for-non-resident-sellers-of-massachusetts-real-estate
• Harris Beach Murtha via JD Supra, What to Know About Massachusetts' Nonresident Real Estate Withholding Tax (Mar. 10, 2026): https://www.jdsupra.com/legalnews/what-to-know-about-massachusetts-4069784/
• DiSanto Priest, New Massachusetts Withholding Rules for High-Value Real Estate Sales by Non-Residents: https://www.disantopriest.com/new-massachusetts-withholding-rules-for-high-value-real-estate-sales-by-non-residents/
• Pullman & Comley, The Form NRW Filing Requirement for Million Dollar Massachusetts Real Estate Sales: https://www.pullcom.com/newsroom-publications-The-Form-NRW-Filing-Requirement-for-Million-Dollar-Massachusetts-Real-Estate-Sales
• Morkel Financial, Massachusetts surtax thresholds by year (citing the Massachusetts Department of Revenue): https://morkelfinancial.com/blog/massachusetts-millionaire-surtax-2026
• M.G.L. c.64D §1 (deed excise): https://malegislature.gov/Laws/GeneralLaws/PartI/TitleIX/Chapter64D/Section1
• MLS Property Information Network (MLS PIN) via Repliers, September 2025 through August 2026

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About Juan Murray

Juan Murray is a Boston broker associate with more than 30 years of experience helping buyers, sellers, and investors across Greater Boston, personally leading every transaction from the first conversation through closing.

RE/MAX Real Estate Center · (978) 581-0801

Equal Housing Opportunity. Juan Murray is licensed as a Broker in Massachusetts, regulated by the Massachusetts Board of Registration of Real Estate Brokers and Salespersons. This article is general information only and does not constitute legal, tax, or financial advice. Confirm your specific costs and obligations with your closing agent, tax advisor, or lender.