Measure ULA (usually called the LA mansion tax) is a transfer tax the City of Los Angeles applies to higher-priced property sales. It took effect in 2023, and it catches sellers off guard more than any other closing cost in this market, for two reasons: it's much larger than people expect, and it's structured in a way that behaves very differently from an income tax.
The current thresholds
For sales closing after June 30, 2026, ULA applies at 4% on sales of $5,400,000 or more, and 5.5% on sales of $10,900,000 or more. Those thresholds are indexed annually to the Chained CPI and reset each July, so they move.
ULA sits on top of the transfer taxes that already existed: the Los Angeles County documentary transfer tax of $1.10 per $1,000, and the City of Los Angeles documentary transfer tax of $4.50 per $1,000. Those two apply to every city sale regardless of price.
It is not marginal, and there's a cliff
Most tax brackets are marginal: cross a line, and the higher rate applies only to the amount above it. ULA doesn't work that way. Once a sale reaches the threshold, the rate applies to the entire price from the first dollar.
The practical consequence is a genuine cliff. A sale at $5,399,999 owes no ULA at all. A sale at $5,400,000 owes $216,000. One additional dollar of sale price costs $216,000 in tax. If your home is anywhere near that line, pricing strategy is not a minor detail. It is the single most consequential decision in the transaction.
Who actually pays it in the Valley
ULA is a City of Los Angeles tax, and this is where most of the confusion in our market comes from. Nearly all of the San Fernando Valley is inside city limits. Woodland Hills, West Hills, Canoga Park, Winnetka, Chatsworth, Northridge, Tarzana, Encino, Sherman Oaks, Studio City and Van Nuys all pay both the city transfer tax and ULA above the threshold.
But several places people think of as 'the Valley' or 'nearby' are separate jurisdictions and pay neither:
- Calabasas and Hidden Hills, separate cities in LA County
- Burbank and Glendale, separate cities
- The City of San Fernando, a separate city entirely surrounded by LA
- Simi Valley, Thousand Oaks, Moorpark and all of Ventura County
- Unincorporated LA County pockets, including Bell Canyon
For a seller near the threshold, that boundary is worth six figures. A $6 million sale in Tarzana carries about $273,600 in combined transfer taxes. The same price in Calabasas or Simi Valley carries about $6,600. Same house, same money, a few miles apart.
What sellers should actually do about it
- Confirm which jurisdiction the property is actually in before pricing. Assessor records, not the mailing address, which can be misleading.
- If you're within roughly 10% of a threshold, model both sides of it. Netting more at a lower price is common near the cliff.
- Include ULA in your net sheet from the beginning. Discovering it after accepting an offer is the worst possible sequence.
- Talk to a CPA about your basis and capital gains separately. ULA is an additional cost, not a substitute for those.
Run your own numbers
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