New York’s Real Estate Tax Exemptions for Senior Citizens and Veterans

by David Goldfarb

New York property laws allow for many specialized property tax exemptions for certain groups of people, including senior citizens and veterans. These exemptions, however, will not automatically go into effect. Instead, you must not only qualify for them but submit an application to the proper party by a certain deadline to benefit from the exemption in a specific year. Applying for your exemption can save you a significant amount of money every year.

 

SCHE exemption – The Senior Citizen Homeowners’ Exemption (SCHE) is available for people ages 65 and older who own cooperative apartments, condominiums, or homes with as many as three families. The combined income of the property owner and spouse must not exceed $58,399, including wages or salary, self-employed income, retirement payments, Social Security, dividends, interest, net rental income, IRA earnings, and capital gains. This application will go through your local assessor.

 

There is a similar tax exemption for low income disabled (DHE). The applicant must have a disability, defined as a physical or mental impairment not due to current use of alcohol or illegal drugs. They must be certified to receive social security disability insurance (SSDI) or supplemental security income (SSI), or certified to receive Railroad Retirement Disability benefits, or received a certificate from the state commission for the blind and visually handicapped stating that such person is legally blind, or be certified to receive a United States Postal Service disability pension, or be certified to receive a United States Department of veterans affairs disability pension. Taxpayers applying for DHE or the SCHE are only entitled to one of the exemptions.

 

STAR credit – The Department of Finance provides this credit toward your property taxes. The basic STAR credit homeowners of all ages may receive this credit as long as the combined income of you and your spouse does not exceed $500,000. If you are age 65 or older, you may qualify for an enhanced STAR credit if your combined income does not exceed $86,000.

 

The STAR real property tax credit transitioned into a personal income tax credit beginning with the tax assessment rolls used for school taxes in 2016–17 and for taxable years starting on January 1, 2016. New applicants who qualify for Basic or Enhanced STAR register with New York State instead of applying to their assessor. They will receive a STAR credit in the form of a check, rather than receiving a property tax exemption (if they qualify for STAR). The dollar value of the credit will be the same as the property tax exemption. New applicants who qualify for Enhanced STAR do not need to register separately to receive the Enhanced benefit if they have already registered to receive the basic benefit.

Veterans’ exemption – New York provides three possible real property tax exemptions for veterans. None of the exemptions except the alternate veterans’ exemption and the Cold War Veterans’ exemption apply to school taxes. Counties, cities, towns, villages, or school districts decide whether to provide the alternative exemption and the Cold War Veteran Exemption.

The first is a partial exemption for property purchased with pension, bonus or insurance (“eligible funds”). Veteran homeowners can apply for a partial property tax exemption through the local assessor. Anyone who served in the United States Army, Air Force, Marines, Navy, or Coast Guard, as well as surviving (but not remarried) spouses of veterans, must provide acceptable military records and apply by certain deadlines (depending on where you live). You must prove an honorable discharge to qualify.

The second (alternative veterans’ exemption) is for residential property of war veterans. Some veterans may qualify for enhanced tax exemptions, which 95 percent of New York state localities offer. You can receive the alternative veterans’ exemption if:

  • You served in a designated time of war
  • You received an expeditionary medal

Your local assessor can tell you if this exemption is available and how you can go about proving your eligibility.

The third is for Cold War Veterans who served on active duty between September 2, 1945, and December 26, 1991. Some New York jurisdictions offer a specific property tax exemption for veterans who served in the military during the Cold War, from September 2, 1945, to December 26, 1991.

Veterans may only select one exemption even if they are eligible for two or three.

Seek Qualified Advice from a New York Estate Planning Lawyer

Every financial advantage is important, and senior citizens and veterans should not miss out on these important property tax exemptions. If you want to discuss other possible financial advantages in New York to help build your estate, please consult with a New York estate planning law firm. Call Goldfarb Abrandt Salzman & Kutzin LLP at (212) 387-8400 or contact our office online.