What Is the LA Mansion Tax and Will It Apply When I Sell My Home?
Justin Borges, DRE #01940318
8 min read
Updated August 2026
The LA Mansion Tax is Measure ULA (United to House LA), a City of Los Angeles transfer tax that took effect April 1, 2023. As of July 2026 it imposes a 4% tax on property sales from $5,400,000 to $10,899,999 and a 5.5% tax on sales of $10,900,000 or more. The tax applies to the full sale price (not just the amount above the threshold), is paid by the seller, and has no primary residence exemption. It applies only within the incorporated City of Los Angeles, not in Glendale, Beverly Hills, Santa Monica, or other independent cities.
If you own a home worth somewhere north of $3 million in the City of Los Angeles, you may be closer to the Measure ULA threshold than you think. The threshold has already risen twice since the tax launched in 2023, adjusting each July 1 based on the Chained Consumer Price Index. Before you price your home, lock in your list date, or model your net proceeds, you need a clear answer on whether Measure ULA applies to your specific sale and exactly how much it will cost you.
This article covers every question your net-proceeds spreadsheet requires: what Measure ULA is, which properties it covers, the current 2026 rates and thresholds, a full price-band breakdown, which cities are excluded, what exemptions exist, and the status of the court challenges as of mid-2026. The math is straightforward once you know the rules.
- What Is Measure ULA and How Did It Pass?
- Which Properties Does It Apply To?
- 2026 Rates and Thresholds
- Price Band Table: How Much Will You Owe?
- Which Cities Are NOT Covered?
- Are There Exemptions?
- How to Calculate Your ULA Exposure
- Has Anyone Challenged It in Court?
- Can You Legally Reduce Your Exposure?
- Frequently Asked Questions
What Is Measure ULA and How Did It Pass?
BackgroundMeasure ULA stands for "United to House LA." Los Angeles voters approved it on the November 2022 ballot as an initiative ordinance, and it took effect on April 1, 2023. It amended the Los Angeles Municipal Code to add an additional special real property transfer tax layered on top of the existing documentary transfer taxes already collected at the time of every deed transfer in the city (Measure ULA, LAMC §21.9.2(b), effective April 1, 2023).
The stated purpose is to fund affordable housing programs and renter protections for low-income Angelenos. Revenue is allocated to the LA Administrative Housing Fund, which distributes money to programs such as tenant outreach, emergency rental assistance, and supportive housing construction. According to the Los Angeles Housing Department, Measure ULA had raised more than $991 million from nearly 1,400 real estate transactions by late 2025.
"Measure ULA is not a capital gains tax. It's a transfer tax that fires the moment a deed is recorded, regardless of how long you've owned the property or whether you made a profit."
Justin Borges, CA DRE #01940318That distinction matters for your planning. The IRS Section 121 exclusion, which lets most homeowners shelter up to $250,000 or $500,000 of capital gain from federal tax, does not offset the ULA transfer tax at all. The two calculations run on separate tracks. Sellers who focus only on their capital gains exposure sometimes get blindsided by ULA at closing (IRS, §121).
Which Properties Does the Mansion Tax Apply To?
Covered PropertiesMeasure ULA covers "all real property" in the City of Los Angeles. That includes single-family homes, condos, multifamily apartment buildings, commercial buildings, industrial properties, and vacant land. There is no carve-out for residential versus commercial, and there is no carve-out based on how the property is used. If the parcel sits within City of Los Angeles jurisdiction and the sale price clears the threshold, the tax applies.
The transaction must be a transfer of an ownership interest. Standard sale transactions, installment sales, and transfers of partial interests that result in a complete change of ownership are all covered. Certain deed-in-lieu transfers, foreclosure-related conveyances, and transfers to qualified non-profit affordable housing organizations carry exemptions discussed further below (Revenue and Taxation Code §11911; LAMC §21.9.14).
One thing that has tripped up some sellers: Measure ULA applies to the sale of LLC or corporate entities that hold real property in certain circumstances. The city has issued guidance warning that structuring a transaction as a sale of an interest in an entity solely to avoid the ULA tax may be treated as a transfer of real property subject to the tax. If your property is held in an LLC, talk to a real estate attorney before assuming you can sidestep ULA by selling the ownership interest instead of the deed.
See active listings above $5M in Los Angeles. Comparing your home against what's trading at this price point helps you calibrate both your list price and your ULA exposure before you commit to a list date.
2026 Rates and Thresholds
Current NumbersThe rates are fixed at 4% and 5.5%. The thresholds, however, are not fixed. They adjust automatically every July 1 based on the Chained Consumer Price Index for All Urban Consumers. This is how the original $5 million and $10 million thresholds from April 2023 have already moved twice (AAGLA, July 2025 threshold update; LA County Assessor, 2026).
At the current 2026 thresholds, a property selling for exactly $5,400,000 owes 4% of the full $5,400,000, which is $216,000, on top of the standard documentary transfer taxes. A property selling for exactly $10,900,000 owes 5.5% of the full $10,900,000, which is $599,500. The base documentary transfer tax adds another 0.56% on every transaction in the City of Los Angeles regardless of ULA (City of LA 0.45% + LA County 0.11%), which the Revenue and Taxation Code §11911 authorizes.
The cliff structure of the tax is the most counterintuitive element. The ULA tax does not apply only to amounts above the threshold. If your home sells for $5,400,001, the 4% rate applies to every dollar of the $5,400,001 sale price. That means a one-dollar step over the $5.4 million threshold produces an immediate tax bill of roughly $216,000. Sellers within a few hundred thousand dollars of the threshold should model both scenarios carefully before setting a list price.
Price Band Table: How Much Will You Owe?
Net Proceeds ImpactThe table below shows the Measure ULA tax and total transfer tax for sale prices at key levels, using the current 2026 thresholds of $5,400,000 and $10,900,000. The base documentary transfer tax column reflects the combined City of LA (0.45%) and LA County (0.11%) rates, totaling 0.56% on all transactions (C.A.R., 2026 net-proceeds guidance).
| Sale Price | ULA Rate | ULA Tax | Base DTT (0.56%) | Total Transfer Tax |
|---|---|---|---|---|
| $4,000,000 | None (below threshold) | $0 | $22,400 | $22,400 |
| $5,000,000 | None (below $5.4M) | $0 | $28,000 | $28,000 |
| $5,500,000 | 4% | $220,000 | $30,800 | $250,800 |
| $6,000,000 | 4% | $240,000 | $33,600 | $273,600 |
| $7,000,000 | 4% | $280,000 | $39,200 | $319,200 |
| $8,000,000 | 4% | $320,000 | $44,800 | $364,800 |
| $10,000,000 | 4% | $400,000 | $56,000 | $456,000 |
| $11,000,000 | 5.5% | $605,000 | $61,600 | $666,600 |
| $12,000,000 | 5.5% | $660,000 | $67,200 | $727,200 |
| $15,000,000 | 5.5% | $825,000 | $84,000 | $909,000 |
Note: Highlighted rows indicate properties at or above each ULA threshold. Thresholds adjust July 1 each year by Chained CPI. Base DTT = City of LA (0.45%) + LA County (0.11%). ULA is paid in addition to, not instead of, the base DTT.
Which Cities Are NOT Covered by Measure ULA?
Jurisdiction MapThis is one of the most common points of confusion: "Los Angeles" in everyday conversation covers a sprawling metro area with dozens of independent cities. Measure ULA is a City of Los Angeles ordinance. It applies only within the incorporated City of Los Angeles. Every other municipality in the greater LA area operates under its own transfer tax rules.
- City of Los Angeles (all neighborhoods)
- Highland Park, Eagle Rock, Glassell Park
- Silver Lake, Los Feliz, Echo Park
- Downtown LA, Koreatown, Mid-City
- Mar Vista, Palms, Westchester
- Studio City, Sherman Oaks, Encino
- Sun Valley, Sylmar, Chatsworth
- Glendale (own transfer tax rules)
- Beverly Hills (independent city)
- Santa Monica (own ordinance)
- Culver City (Measure RE)
- Pasadena (own municipal code)
- Burbank, Torrance, Long Beach
- Unincorporated LA County areas
The quickest way to confirm your parcel's jurisdiction is to look up your address on the LA County Assessor's property portal at assessor.lacounty.gov. The results page shows the "Tax Rate Area" and jurisdiction. If it lists the City of Los Angeles, Measure ULA applies. If it shows any other incorporated city or "unincorporated" county territory, it does not. Do not rely on mailing address or neighborhood name alone. Parts of the San Fernando Valley, for example, use "Los Angeles" in the address but are located within the City of Los Angeles, which is a single municipality that stretches far beyond what most people picture.
"I've seen sellers in Eagle Rock assume they're not in the City of LA, and sellers in Glendale assume they are. Get the assessor confirmation before you price."
Justin Borges, CA DRE #01940318Are There Exemptions from Measure ULA?
Exemption CatalogMeasure ULA includes a short list of exemptions, but the most commonly hoped-for exclusion, primary residence status, is not among them (Measure ULA, LAMC §21.9.14 and §21.9.15). A homeowner who has lived in a property for 30 years and is downsizing owes the same ULA tax as an investor selling a rental property at the same price. The law does not ask how you used the property.
The exemptions that do exist are narrow. Non-profit affordable housing organizations that qualify under LAMC §21.9.14 are exempt when they receive a transfer. Tax-exempt organizations qualifying under LAMC §21.9.15 may also be exempt when they are the transferee. Government-to-government transfers, deeds in lieu of foreclosure in some circumstances, and transfers required by court order in a dissolution or probate proceeding may also qualify. The seller or their attorney must apply for an exemption determination from the LA Office of Finance before or at the time of recording.
It is also worth being explicit about 1031 exchanges. A 1031 exchange under IRS §1031 defers recognition of capital gain and the associated federal and California capital gains taxes. The exchange does not, however, change the fact that a deed is being recorded transferring the relinquished property to a buyer. The ULA tax is triggered by the transfer of real property, not by the recognition of a capital gain (Franchise Tax Board, 2026). So the ULA tax is still due on the sale leg of a 1031 exchange. The exchange protects your gain from federal and state income tax while leaving the transfer tax obligation untouched.
Is Your Property Subject to the Mansion Tax?
The ULA transfer tax kicks in at $5.4M in 2026. Before you list, get an accurate, comps-backed valuation so you know exactly what your net proceeds will look like.
Get My Free Home ValuationHow to Calculate Your ULA Exposure Before Listing
Step-by-Step CalculationThe calculation itself is simple. The complications come from confirming jurisdiction, getting an accurate price estimate, and understanding the cliff structure. Walk through these steps before you commit to a list price.
Step 1: Confirm your parcel is in the City of Los Angeles. Use the LA County Assessor property lookup at assessor.lacounty.gov and confirm the jurisdiction reads "Los Angeles City." If it does not, stop here. Measure ULA does not apply.
Step 2: Establish an estimated sale price. For the math to be useful, the price estimate needs to be realistic, not aspirational. Pull three to five recent comparable sales within half a mile, similar square footage, and similar condition. For luxury properties, this is genuinely harder because the comp set is thin. A pricing opinion from an agent with recent experience in that price band is more reliable than any automated valuation tool.
Step 3: Compare the price to the current ULA threshold. The current thresholds as of July 1, 2026, are $5,400,000 for the 4% bracket and $10,900,000 for the 5.5% bracket. If your estimated price falls below $5,400,000, no ULA tax applies and you can skip to step 6 (LA County Assessor, 2026).
Step 4: Apply the rate to the full sale price. If your price is at or above $5,400,000 but below $10,900,000, multiply the full price by 4%. If your price is at or above $10,900,000, multiply the full price by 5.5%. For a $7 million sale: $7,000,000 x 0.04 = $280,000 ULA tax.
Step 5: Add the base documentary transfer taxes. The City of LA collects 0.45% and LA County collects 0.11%, totaling 0.56% on the same sale price. For a $7 million sale: $7,000,000 x 0.0056 = $39,200 in base DTT. Total transfer taxes on that $7 million sale: $319,200.
Step 6: Build it into your net proceeds model. Add agent commissions, escrow, title insurance, any outstanding mortgage, and the total transfer taxes. The number that's left is your net. If the number changes the calculus on whether to sell now versus later, that's a meaningful planning input, not just arithmetic.
Step 7: Consult a CPA or real estate tax attorney before listing. Measure ULA, capital gains, Prop 19 considerations, and 1031 exchange timing all interact. A qualified advisor can help you model the complete picture and identify any legal structure options that apply to your specific situation. The Franchise Tax Board publishes guidance on how California capital gains interact with transfer taxes, and your CPA can run both sets of numbers in parallel (Franchise Tax Board, 2026).
Has Anyone Challenged Measure ULA in Court?
Legal StatusYes. The Howard Jarvis Taxpayers Association (HJTA) and the Apartment Association of Greater Los Angeles (AAGLA) filed a lawsuit against Measure ULA in December 2022, shortly after it passed. Their argument was that voters could not enact such an ordinance because the City Council was barred from doing so under Proposition 13 and the state constitution. The Los Angeles Superior Court, Judge Barbara Scheper presiding, dismissed the challenge in February 2023.
HJTA and AAGLA appealed. In December 2025, a three-judge panel of the California Court of Appeal for the Second District unanimously affirmed the dismissal, ruling that Los Angeles voters had the authority to enact Measure ULA through the initiative process. As of August 2026, Measure ULA is fully upheld, fully in effect, and being collected on all qualifying transactions.
HJTA has indicated it may explore further options, potentially a petition to the California Supreme Court, but as of mid-2026 no stay or injunction is in place and the tax is being collected. Sellers should not plan around the possibility of ULA being retroactively invalidated. Plan as if the tax will apply at closing, because it will.
What Is My Home Worth Before the Mansion Tax?
Knowing your precise market value determines your exact tax exposure and net proceeds. Get a free valuation backed by real comps before you make any listing decisions.
Get My Free Home ValuationCan You Legally Reduce Your Exposure to the Mansion Tax?
Planning ConsiderationsThere is no straightforward legal mechanism to avoid Measure ULA if you are selling a property within the City of Los Angeles at or above the current threshold. The tax is due at recording and is the seller's obligation. That said, there are some planning considerations worth knowing before you make decisions about timing and structure.
Pricing around the threshold. If your home's realistic market value is within a few hundred thousand dollars of either the $5.4 million or $10.9 million threshold, the cliff structure of the tax makes a small price difference very expensive. A home that sells for $5,399,999 owes zero ULA tax. The same home at $5,400,000 owes $216,000. The math does not mean you should artificially underprice a home, but it does mean your pricing strategy should model both sides of the threshold explicitly.
Timing and the annual CPI adjustment. The thresholds rise each July 1. If your home is currently valued just above the current threshold, a sale timed to maximize the spring market (April through June) may land above the threshold that will reset on July 1. Conversely, if your home will clearly be above both the current and next year's threshold, the adjustment does not change your exposure materially.
Entity structure discussions. Some sellers have asked whether selling an LLC interest rather than the deed avoids ULA. The City of Los Angeles has addressed this approach in its administrative guidance. A transfer structured purely to evade ULA where the economic substance is a transfer of real property may be treated as taxable. If you hold your property in an entity and are considering this, get a formal opinion from a real estate tax attorney who practices in LA before assuming the structure works.
1031 exchange on the purchase side. If you are selling into a 1031 exchange, the ULA tax on the sale leg is still due and cannot be deferred. However, the capital gains tax deferral on the exchange can meaningfully improve the overall after-tax economics of the transaction, especially at higher price points. Run both calculations side by side with your CPA (IRS, §1031 exchange rules).
Compare what's selling near the ULA threshold. Seeing active and recently sold properties in the $5M to $12M range helps you set a realistic expectation for pricing and market time before your listing appointment.
Frequently Asked Questions
What is the LA Mansion Tax?
The LA Mansion Tax is the informal name for Measure ULA (United to House LA), a City of Los Angeles additional transfer tax on real property sales above a threshold, effective April 1, 2023. As of July 2026 the thresholds are $5,400,000 at a 4% rate and $10,900,000 at a 5.5% rate. Revenue funds affordable housing programs.
Who pays the LA Mansion Tax, the buyer or the seller?
The seller pays Measure ULA. It is assessed on the seller at the time of deed recordation and is separate from and in addition to the standard City and County documentary transfer taxes. The obligation can be addressed in contract negotiations, but by default it is a seller cost.
Does the LA Mansion Tax apply in Glendale, Beverly Hills, or Santa Monica?
No. Measure ULA is a City of Los Angeles ordinance. It applies only within the incorporated City of Los Angeles. Glendale, Beverly Hills, Santa Monica, Culver City, Pasadena, and all other independent municipalities in the metro area have their own separate transfer tax rules and are not subject to Measure ULA.
Is there a primary residence exemption from Measure ULA?
No. Measure ULA includes no primary residence exemption. Sellers who have lived in their home for decades owe the same rate as investors. The exemptions that do exist are narrow: certain non-profit affordable housing organizations, tax-exempt transferees, and government entities. Ordinary homeowners and investors do not qualify for any exemption based on residency or ownership duration.
Does a 1031 exchange avoid the LA Mansion Tax?
No. A 1031 exchange defers capital gains taxes but does not eliminate or defer the Measure ULA transfer tax. The ULA tax is triggered by the transfer of a deed, not by the recognition of capital gain. Even if proceeds roll into a replacement property, the ULA tax is still due on the relinquished-property closing.
What is the current Measure ULA threshold in 2026?
As of July 1, 2026, the 4% bracket begins at $5,400,000 and the 5.5% bracket begins at $10,900,000. These thresholds adjust every July 1 based on the Chained Consumer Price Index. The original thresholds from April 2023 were $5,000,000 and $10,000,000; they reached $5,300,000/$10,600,000 in July 2025.
Has the LA Mansion Tax survived court challenges?
Yes. The Howard Jarvis Taxpayers Association challenged Measure ULA in 2022. The LA Superior Court dismissed the challenge in February 2023. The California Court of Appeal for the Second District affirmed that dismissal in December 2025. As of August 2026, Measure ULA is fully upheld and no active court injunction exists.
What happens if my sale price lands just above the $5.4 million threshold?
The tax applies to your full sale price, not just the amount above the threshold. A sale at $5,400,001 produces a ULA tax of roughly $216,000. A sale at $5,399,999 produces $0. Sellers within a few hundred thousand dollars of either threshold should model both scenarios with their agent and a tax advisor before committing to a list price or accepting an offer.
LA Mansion Tax Quick Reference
| Your Situation | What It Means for ULA |
|---|---|
| Selling in Glendale, Beverly Hills, or Santa Monica | Measure ULA does not apply. Those are separate cities with their own transfer tax rules. |
| Selling in City of LA below $5,400,000 | No ULA tax. You still owe the standard 0.56% documentary transfer tax. |
| Selling in City of LA between $5.4M and $10.9M | 4% ULA tax on the full sale price, plus 0.56% base DTT. Example: $7M sale = $319,200 in total transfer taxes. |
| Selling in City of LA above $10.9M | 5.5% ULA tax on the full sale price, plus 0.56% base DTT. Example: $12M sale = $727,200 in total transfer taxes. |
| Doing a 1031 exchange | ULA is still due on the sale. The exchange defers capital gains only, not the transfer tax. |
| Primary residence owned for 30+ years | No exemption. ULA applies regardless of how long you have owned or occupied the property. |
| Property held in an LLC | Entity structure does not automatically avoid ULA. Get a tax attorney opinion before assuming it works. |
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