The California mansion tax is the nickname for Measure ULA, a Los Angeles transfer tax that adds 4% to sales of city real property at $5,300,000 or more, and 5.5% to sales at $10,600,000 or more. It is not a statewide tax and it is not limited to homes: commercial and industrial properties above the threshold pay the same rate. Voters approved it in November 2022, and it has been collected on deeds recorded on or after April 1, 2023.
How the Tax Is Calculated
Measure ULA sits on top of the City of Los Angeles’s existing base transfer tax of 0.45% ($2.25 per $500 of sale price). The ULA portion only applies once the sale price crosses a threshold, and the thresholds move each year with the Bureau of Labor Statistics Chained Consumer Price Index. For deeds recorded after June 30, 2025, they are $5,300,000 and $10,600,000, up from the original $5,000,000 and $10,000,000.1Los Angeles Office of Finance. Real Property Transfer Tax and Measure ULA FAQ
Combined with the base tax, the effective rates are:
- 4.45% on sales at $5,300,000 or more but under $10,600,000
- 5.95% on sales at $10,600,000 or more
The detail that trips up sellers: the ULA rate applies to the entire sale price, not just the amount above the threshold. A sale at $5,300,001 owes 4% on the full $5,300,001.1Los Angeles Office of Finance. Real Property Transfer Tax and Measure ULA FAQ
The Pricing Cliff at Each Threshold
Because the tax hits the whole price, crossing a threshold by a dollar can cost hundreds of thousands. A sale at $5,299,999 owes no ULA tax. A sale at $5,300,000 owes roughly $212,000.
The same cliff sits at the upper threshold. A sale at $10,599,999 triggers the 4% rate (about $424,000 in ULA tax). A sale at $10,600,000 jumps to 5.5% of the full price, or $583,000. One additional dollar of sale price adds about $159,000 to the tax bill. If you are pricing anywhere near either threshold, run the net proceeds both ways before you list.
Two Worked Examples
A $6,000,000 sale falls in the lower tier. ULA tax at 4% is $240,000. The base transfer tax at 0.45% adds $27,000. Total transfer taxes at closing: $267,000.1Los Angeles Office of Finance. Real Property Transfer Tax and Measure ULA FAQ
A $12,000,000 sale falls in the upper tier. ULA tax at 5.5% is $660,000. The base tax adds $54,000. Total: $714,000, close to 6% of the sale price before commissions or any other closing costs.1Los Angeles Office of Finance. Real Property Transfer Tax and Measure ULA FAQ
Who Pays and When
The seller is legally responsible for the tax. Parties can agree in the purchase contract to split or shift it, but the default under the ordinance puts it on the seller, and that is how most transactions close.
Payment is due when the deed is recorded with the Los Angeles County Registrar-Recorder/County Clerk, which collects the tax and remits the city’s portion to the Los Angeles Office of Finance. Escrow typically handles the payment in certified funds. Depending on the transaction, sellers or their agents may need to complete a ULA Tax Affidavit or a Declaration of Exemption as part of closing.1Los Angeles Office of Finance. Real Property Transfer Tax and Measure ULA FAQ
Who Qualifies for an Exemption
Exemptions belong to the transferee (the buyer), not the seller, and are applied for through the Los Angeles Housing Department’s applicant portal. There are two main categories.
Under Section 21.9.14, affordable housing organizations may qualify: 501(c)(3) nonprofits with a track record in affordable housing development or management, community land trusts, limited equity housing cooperatives, and partnerships in which one of those entities is the managing member. A community land trust or cooperative without direct experience can still qualify by partnering with an experienced nonprofit or by recording a permanent affordability covenant at the time of purchase.2City of Los Angeles Housing Department. Eligibility Guidelines for the ULA Homelessness and Housing Solutions Tax Exemption
Under Section 21.9.15, a broader exemption covers 501(c)(3) organizations with less than $1 billion in assets that have held IRS tax-exempt status for at least ten years before the transfer, government entities, and entities exempt from the city’s taxing power under the U.S. or California Constitution.2City of Los Angeles Housing Department. Eligibility Guidelines for the ULA Homelessness and Housing Solutions Tax Exemption
Ordinary homeowners and commercial sellers do not qualify. If the sale price crosses the threshold and the buyer is not a qualifying nonprofit or government entity, the tax is owed.
Federal Tax Treatment
The IRS does not allow sellers to deduct transfer taxes as real estate taxes on a federal return. Sellers can treat them as selling expenses, which reduces the taxable gain on the sale. Buyers who pay a transfer tax can add it to their cost basis, lowering the taxable gain when they eventually sell.3Internal Revenue Service. Publication 523 – Selling Your Home
On a $12 million sale with $714,000 in combined transfer taxes, the selling-expense treatment meaningfully reduces the capital gains hit without erasing the tax itself. Treatment differs between a primary residence, an investment property, and a business asset, so coordinate with a tax advisor before closing.
Legal Challenges and What Could Change
Opponents sued shortly after the tax took effect. A Los Angeles County Superior Court judge dismissed the challenge, holding that the electorate’s initiative power is broadly protected and that voters may use it to impose taxes. As of early 2026, no appellate court has overturned that ruling and the tax remains in place.
The larger threat is on the ballot. The Howard Jarvis Taxpayers Association has been gathering signatures for a statewide measure that would sharply cap municipal transfer taxes across California. As of March 2026, the campaign reported more than 1.3 million signatures collected against a roughly 900,000-signature validity requirement for the November 2026 ballot, with verification underway. If it qualifies and passes, it could effectively gut Measure ULA along with the elevated transfer taxes in other California cities.
Similar High-Value Transfer Taxes Elsewhere in California
Measure ULA gets the most attention, but it is not the only local transfer tax on high-value sales. California’s standard documentary transfer tax is $1.10 per $1,000 of value, and charter cities can set their own rates. San Francisco imposes a tiered tax reaching 5.5% on sales between $10 million and $25 million and 6% at $25 million and above. Culver City charges 0.45% under $1.5 million, scaling to 4% at $10 million or more. Santa Monica charges $3 per $1,000 under $5 million, $6 per $1,000 between $5 million and $8 million, and $56 per $1,000 (5.6%) at $8 million and above.4Los Angeles County Registrar-Recorder/County Clerk. Documentary Transfer Taxes – General Info If you are selling above the top tier in any of these cities, check the local rate table before setting a price.