The deadline to file exemption applications for New York City’s pied-à-terre tax is Tuesday, and the city is treating its notices as in effect while it appeals a judge’s order to cancel them.
State Supreme Court Justice Wayne Ozzi in Staten Island ruled Sept. 29 that the city mishandled the rollout of its non-primary residence surcharge and ordered it to cancel notices sent to about 17,000 owners and start over, Inman reported. The city filed its appeal that night, which automatically paused the order and allowed it to continue implementing the surcharge, a city official said at the time.
As of Monday, Oct. 5, the Oct. 6 deadline remains in effect, according to the Department of Finance’s website. Randy Mastro, the homeowners’ lawyer, said at a Sept. 29 news conference that he would ask the appellate court to lift the pause on the order.
“It’s important to understand that the new law itself is not, and never was, at risk of being invalidated by this proceeding,” William McCracken and David Fitzhenry of law firm Moritt Hock & Hamroff said in comments provided to Inman.
What agents are seeing
Heather Domi, an agent with Douglas Elliman who in August testified at a New York City Council oversight hearing against the surcharge, said the exemption process has gone smoothly for owners with straightforward situations, but it’s gone poorly for those without.
“It’s been a scramble,” Domi told Inman in an email. “It’s these other nuanced cases [that] haven’t been fine.”
One of her clients, a landlord, has already had an exemption application rejected and is gathering documents for a second round, she said. She said about a dozen people she has worked with have hired attorneys to appeal.
Domi said the city could have established residency using records it already holds, including tax returns, the co-op and condo abatement for full-time residents and the Senior Citizen Homeowners’ Exemption.
“So [there were] a lot of different opportunities for them to do their homework instead of putting the responsibility on the homeowner,” she said.
She said the surcharge is also affecting rentals, with leases now including riders on residency requirements. “If you are moving here as a foreign national, unless your plan includes claiming residency, no individual landlord will take you on as a tenant,” Domi said.
Next year’s notices
Benjamin Williams, who leads the property tax department at law firm Rosenberg & Estis, said the New York City Department of Finance reversed more than 1,200 of its initial determinations after receiving preliminary 2025 state tax data in August, citing the city’s disclosures in court. Next year, DOF will have about six weeks between the Jan. 5 taxable-status date and its Feb. 15 deadline for sending notices, he said in comments provided to Inman.
“The goal shouldn’t be to figure out how to correct mistakes after homeowners receive a surcharge notice,” Williams said. “It should be to avoid putting primary residents into the process unnecessarily in the first place.”
The mayor’s office has defended the surcharge, which it says asks owners of luxury second homes to pay their fair share for city services. Two lawsuits filed last week, one funded by the Real Estate Board of New York and one brought by Wilbur Ross, Hilary Geary Ross and Steve Wynn, allege the tax is unconstitutional, Inman reported.
