How current events impact your business and real estate holdings

Wednesday, August 19, 2015

Superstorm Sandy Property Tax Relief

The Governor signed a new law this month that provides tax relief to homeowners who renovated or repaired their homes after Superstorm Sandy (Sandy), or are in the process of or are considering doing the same. 

While driving through the coastal neighborhoods of Long Island, Queens and Brooklyn, it’s a very common sight to see homes being raised, abandoned, for sale or completely renovated and looking brand new; all of these events generally being caused by Sandy.

When the renovations were made, homeowners likely were worried about being able to live in their homes again, not about minimizing the resulting property value increase, so this law creates welcomed relief for those who are going to be shocked to find a significantly higher property tax bill for their renovated homes (i.e., the renovation increased the home’s value and hence the home’s allocation for real estate taxes).

Some fine print that is important for assessing eligibility for this exemption:
  1. Applications are to be made to your local Town Assessor; 
  2. The home must be used and occupied for residential purposes (1-3 family homes are eligible); 
  3. The current owner must have owned the home prior to October 29, 2012; 
  4. Renovations must have been made to portions of the home that existed before October 29, 2012 and a new Certificate(s) of Occupancy showing the improvements must be obtained on or before March 1, 2018; 
  5. You can apply for the exemption beginning March 1, 2016, but no later than March 1, 2018; 
  6. If you are thinking of selling or buying a home that may be eligible for this exemption, be aware that the exemption terminates if the title to the home is transferred (except for those who inherit and then occupy the home); and 
  7. The exemption can last 8 years if homeowner complies with the conditions described herein. 

It is important for those who recently completed or are in the middle of renovations to make sure that they obtain their final Certificate(s) of Occupancy before March 1, 2018 to remain eligible for this exemption, as this process can be frustratingly long depending on the work done to the home.

Homeowners who are interested in applying for this exemption should consult with their contractors and real estate attorneys to make sure their Certificate(s) of Occupancy are in order and that important deadlines are not overlooked.