Background
The application process for the New York City Cooperative and Condominium Property Tax Abatement (the "Coop-Condo Abatement") has recently changed, and boards and managing agents will have to comply with the new requirements in order to obtain or maintain the benefits on behalf of qualifying cooperative and condominium homeowners.
This Stroock Special Bulletin outlines the new requirements and procedures for a Coop-Condo Abatement application.
What is the Coop-Condo Abatement?
The Coop-Condo Abatement is a benefit available to qualifying cooperative and condominium homeowners. It provides a property tax reduction that ranges from 17.5% to 28.1%. The application for the Coop-Condo Abatement must be submitted annually by the sponsor or managing agent on behalf of eligible owners.
Who May Apply for the Coop-Condo Abatement?
The Coop-Condo Abatement is generally available to eligible cooperative and condominium homeowners who use their apartment as their primary residence, and so long as the apartment was purchased on or before January 5th of the tax year for which the application is being made.
There are no age or income restrictions for eligibility for the Coop-Condo Abatement. Apartments that are owned in trust may be eligible if the apartment is the primary residence of the beneficiary of the trust, the trustee or the life estate holder.
Among other exclusions from eligibility, the Coop-Condo Abatement is not available to:
- A business entity (such as an LLC).
- An owner who owns more than three residential apartments in the same development or a sponsor.
- Mitchell-Lama or HDFC cooperatives.
What are the Changes to the Coop- Condo Abatement for Buildings Currently Receiving Benefits?
For buildings that already receive the Coop- Condo Abatement, two filings are now required instead of one.
- To continue receiving an existing abatement and to add new eligible homeowners to the abatement, sponsors and/or managing agents must file the 2017/2018 Tax Benefit Change Form by March 31, 2017. In future years, the form will be due by February 15th.
- Sponsors and/or managing agents must also file the 2016/2017 Tax Benefit Change Form by February 15, 2017 and must notify the Department of Finance of any changes in ownership or eligibility regarding apartments in the building.
Copies of the Tax Benefit Change Forms are available here.
Application Process for New Construction Buildings or Existing Buildings That Have Never Applied for the Coop-Condo Abatement
March 1, 2017 is the filing deadline for the Coop-Condo Abatement application for buildings that will be first-time applicants – whether because they are new construction buildings or existing buildings that have never applied for benefits in the past.
No building – whether it already receives the Coop-Condo Abatement or is applying for the first time – may simultaneously receive the Coop- Condo Abatement and other property tax incentives such as 421-a or J-51.
The Coop-Condo Abatement may be available to qualifying cooperative and condominium homeowners as early as July 1, 2017, assuming the application is completed and processed by DOF.
A copy of the 2017/2018 Cooperative and Condominium Property Tax Abatement Application for first time applicants is available here.
Is the Coop-Condo Abatement the Only Benefit Available to Shareholders and Unit Owners in a Cooperative or Condominium?
No. The Coop-Condo Abatement is only one of many benefits available to cooperative and condominium homeowners. A list of other benefits, such as the Disabled Homeowners Exemption, Senior Citizen's Homeowner's Exemption and the STAR Exemption, is available on the Department of Finance's website here.
The Coop-Condo Abatement is an excellent benefit that every sponsor and managing agent should obtain on behalf of eligible homeowners.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
