The age-old adage from Benjamin Franklin perhaps says it best: nothing is certain but death and taxes.
And without some assistance on the legislative front, taxes are likely to increase significantly for New York City co-op and condo owners in the near future. Homeowners are facing a potential double-digit increase in their tax burden for fiscal year 2012-13 if the state Legislature fails to extend the Cooperative and Condominium Tax Abatement Program, as had been promised in July.
A Taxing Situation
The New York City tax abatement program gives partial tax relief to owners and tenant-shareholders of residential Class 2 properties. This is because Class 1 properties (i.e., one-, two-, and three-family homes), are assessed at a lower percentage of market value than their Class 2 counterparts.
According to the Department of Finance (DOF), the failure to extend the abatement may require them to go back and issue higher tax bills later on. “If your property qualified for the 'Condo/Co-op Abatement' for fiscal year 2012-2013, your July 2012 Property Tax Bill was based on the anticipation that the abatement would be in effect for fiscal year 2012-13 (which starts July 1, 2012). However, as you may be aware, the abatement was not extended beyond June 30, 2012,” said the department’s statement.
According to the Finance Department’s Annual Report on the NYC Property Tax for Fiscal Year 2012, under the program, co-ops were abated to the tune of $298.6 million and $105.1 million for condos.