HEADS UP NYS PROPERTY OWNERS - THE STAR PROPERTY TAX PROGRAMS IS REQUIRING YOU TO RE-REGISTER!

If you own real estate, you know that one of the few advantages to living in New York State is a modest tax break offered through the State’s STAR property tax rebate program, which gives homeowners a break on their local school taxes. Most homeowners will qualify for exemptions under either the Basic or Enhanced STAR program, but your eligibility will depend on such things as your age and whether the property is your primary residence.

Once a homeowner remits his or her application for STAR eligibility, their qualifications to remain in the ranks of the program are typically self-renewing, meaning that most individuals didn’t need to worry about doing anything to keep the credit. There’s a change coming though!

Based on the results of an investigation in Rockland County, investigators discovered fraud and systemic abuses in just five towns that amounted to almost $680,000 in credits that were improperly taken. The majority of the fraud resulted from persons claiming credits for which they were ineligible, such as for second homes or for rental property. The legislature calculates that on a statewide basis, these abuses cost New York more than $13 million in revenue during the 2011-2012 fiscal year. If allowed to continue, projections suggest that the abuses will have cost the state more than $73 million in revenue by 2016.

In an effort to purportedly address this abuse, the State legislature has decided to pass as a part of its budget deal new rules requiring all homeowners to re-register for their ongoing STAR status. The intention is to re-qualify those homeowners who are purportedly eligible for the program, while weeding out those merely trying to take advantage of the system.

Was there no other more efficient way for the legislature to accomplish this goal than to place the burden on all homeowners to re-register? I think there likely was, but our politicians (in their infinite wisdom) have deemed this solution to be the best, and so we are stuck with it. That said, no details as to how to re-register or when re-registration must be completed by have been forthcoming from the state as of yet.

Given the potential negative impact on your individual wallets if you forget or fail to re-register, one can only presume (or should I say hope) that the state and/or local assessors will notify homeowners about the process when everything is finally set in stone. Then again, perhaps it’s the cynic in me, but given the potential impact on the state’s coffers as far as a positive revenue stream if people fail to re-register, maybe this information won’t be as forth coming or widely publicized as it otherwise should be… Only time will tell, but rest assured that I’ll update you with any relevant information about the process as it becomes known.