The New York stock transfer tax is an excise tax on transfers of corporate stock connected to the state, but a 100% rebate enacted in 1981 cancels the entire liability on every taxable transaction. For ordinary exchange trades, brokers and clearing corporations handle the pay-and-reclaim cycle behind the scenes, so you pay nothing. For private stock transfers, the tax becomes a real cost if you miss the two-year window to claim the rebate.
What Triggers the Tax
The tax hits the transfer of ownership itself, not any gain or loss on the deal. It applies whether the seller made money, lost money, or broke even. Covered events include sales, agreements to sell, memoranda of sales, deliveries, and transfers of corporate stock and certificates within New York, along with changes of record ownership on the books of a New York company.
Trades on the NYSE and Nasdaq are covered because they carry a New York connection, even when the buyer and seller are elsewhere. Private transfers and closely held stock are covered too, when the transaction has a sufficient tie to the state. The seller owes the tax, but the collection burden falls on intermediaries like brokers and clearing corporations.
Per-Share Rates
The tax is measured in cents per share based on the selling price, not as a percentage of the transaction:
- Under $5 per share: 1.25 cents per share
- $5 to under $10 per share: 2.5 cents per share
- $10 to under $20 per share: 3.75 cents per share
- $20 or more per share: 5 cents per share
Transfers that are not sales, such as gifts of stock, are taxed at a flat 2.5 cents per share regardless of value.1New York State Senate. New York Tax Law 270 – Amount of Tax A sale of 10,000 shares at $25 each produces a gross tax of $500 before the rebate is applied.
The 100% Rebate
New York rebates the full stock transfer tax on every taxable transaction occurring on or after October 1, 1981.2New York State Senate. New York Tax Law 280-A – Rebate for Stock Transfer Tax Paid; Penalty for False Claims The rebate is not limited to exchange-traded securities. Private transfers and closely held shares qualify as well; the difference is who files and how.
For trades executed on a registered exchange, the clearing infrastructure handles the whole cycle. The broker or clearing corporation withholds the tax, remits it to the state, and files the rebate claim on the customer’s behalf. Retail investors never see the tax on a confirmation because the payment and rebate offset each other automatically.
For stamp-based payments, typically used in private stock transfers, the taxpayer or their agent files for the rebate directly. The claim must be submitted within two years of the date the stamps were purchased, and the original purchase receipt has to accompany it.3New York State Department of Taxation and Finance. TSB-M-82 (6)M – Stock Transfer Tax Rebate Program Stamp Users Miss that window and the rebate is forfeited. That is where a theoretical tax turns into an actual bill. Anyone handling a private stock sale in New York should calendar the two-year deadline the moment the stamps are paid for.
Transfers That Are Exempt Entirely
Some transfers avoid the tax altogether, meaning no payment and no rebate filing. These generally happen by operation of law rather than by a voluntary sale:
- Transfers from a decedent to an executor or administrator, and from a deceased joint tenant to the survivor
- Transfers from a bankrupt person to a trustee in bankruptcy or receiver
- Transfers between a minor and guardian, an incompetent person and their legal representative, or a conservatee and conservator
- Transfers from trustees to surviving, substitute, or successor trustees of the same trust
- Transfers made to carry out certain court-confirmed bankruptcy reorganization or adjustment plans
To keep the tax from being withheld at the time of transfer, you have to present an exemption certificate.4New York State Senate. New York Tax Law 270-C – Transfers by Operation of Law; Special Exemptions A separate provision exempts certain transfers from an executor or administrator to a legatee, heir, or distributee, but only where the value of the shares does not exceed the tax that would otherwise apply — narrow enough that it rarely helps with shares of meaningful value.5New York State Senate. New York Tax Law 270-B – Exemption of Certain Transfers to Legatees and Others
Filing and Stamp Mechanics
For exchange-traded securities, clearing corporations like the Depository Trust Company and brokerage firms act as withholding agents. They calculate and collect the tax at the time of the trade, remit it, and claim the rebate, so the individual investor files nothing.6New York State Department of Taxation and Finance. Stock Transfer Tax Broker-dealers themselves file Form MT-650 quarterly and attach the weekly MT-651 reports for that quarter.7New York State Department of Taxation and Finance. MT-650 – Stock Transfer Tax Quarterly Return of Stock Transfer Taxes Withheld
Private transfers work differently. The taxpayer orders physical tax stamps using Form TD-624, affixes them to the bill of sale or stock certificate being surrendered, and cancels them so they cannot be reused.6New York State Department of Taxation and Finance. Stock Transfer Tax The rebate is then claimed on Form MT-656 inside the two-year window.
Penalties for Not Paying
Failing to pay the tax or to properly affix stamps is a misdemeanor. Conviction carries a fine between $500 and $1,000, up to six months in jail, or both, at the court’s discretion. A broker or agent who fails to pay is also personally liable for the unpaid tax as a civil matter, and that civil liability applies regardless of whether the person is prosecuted or acquitted on the criminal side. There is one safe harbor: a broker who relies in good faith on a nonresident exemption declaration, with no reason to believe it is invalid, is not subject to these penalties.8New York State Senate. New York Tax Law 272 – Penalty for Failure to Pay Tax; Liability for Tax of Agent or Broker
Not the Same as the Federal SEC Fee
The small charge that sometimes appears on trade confirmations is not the New York tax. It is the Section 31 fee under the Securities Exchange Act, which funds the SEC. As of April 4, 2026, the rate is $20.60 per million dollars in covered transactions, or roughly one cent on a $50,000 sale.9U.S. Securities and Exchange Commission. Section 31 Transaction Fee Rate Advisory for Fiscal Year 2026 It is federal, it is tiny, and it has nothing to do with the New York rebate process.