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New York Bill Would Increase, Expand Real Property Tax Relief

Posted on Dec. 29, 2021

A New York lawmaker has introduced legislation that would increase and expand the excess real property tax credit.

Under current law, taxpayers can take a refundable credit for excess real property tax — that is, the amount of property tax that exceeds 6 percent of a taxpayer's qualifying gross income. The credit was created by the fiscal 2022 budget and is effective for tax years beginning on or after January 1, 2021 and ending before January 1, 2024. 

Under S. 7624, introduced December 22 by Sen. James Gaughran (D), excess real property tax would be the amount of the tax that exceeds 5 percent of a taxpayer's qualified gross income. The bill would also increase the credit amount from 14 percent to 20 percent of excess real property taxes for taxpayers whose gross income is $75,000 or less; amend the calculation for determining the credit amount for taxpayers with gross income over $75,000; and increase the maximum gross income eligibility for the credit from $250,000 to $350,000. The maximum amount of real property tax relief credit that taxpayers can claim would also be increased from $350 to $1,500.

The bill would also make the credit permanent. According to the bill's sponsor memorandum, "More New Yorkers will be eligible for the credit and the level of the credit will be greater, providing real property tax relief to working families on a permanent basis." The memo says the COVID-19 pandemic has exacerbated rising housing costs, and S. 7624 would increase housing affordability within the state and make it more economically competitive.

S. 7624 was referred to the Senate Rules Committee. It would take effect immediately if enacted and would apply to tax years starting on or after January 1, 2022.

Gaughran’s office did not respond to a request for comment by press time.

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