by Laura Matiz
The new property tax rates for fiscal year 2016—which started on July 1, 2015—were announced on June 26th after the City Council adopted the Mayor’s budget. For a fuller explanation on the confusing property tax system, see The Byzantine NYC Property Tax System (April 26, 2015).
The Class 1 (1-3 family homes) property tax rate went up 0.00397 points to 19.554% while Class 2 (condos, coop, rental buildings) property tax rate went up 0.00028 points to 12.883%. As explained in that earlier article, the Class 1 property tax rate is applied to 6% of the market value, while for Class 2 properties, the rate is applied to 45% of the market value.
In the table below, I have computed the "true rate" on market value for each class.
Category: Property Tax
by Laura Matiz
If you do a Google search for "New York City property tax system," you will run across quotes from politicians and experts repeating statements such as, "the whole tax-assessment system is broken" or stating the system as a "mind-numbingly complex method of assessing property taxes." More importantly, the system has been broken for a long time with the last major correction enacted in 1996. That correction was known as the Cooperative and Condominium Tax Abatement.
Change may not be coming soon, but one thing all property owners can do is to educate themselves on the basics of the system. To start, all property is categorized into four classes, with most large cooperative and condominiums buildings in Manhattan falling under Class 2, as shown in the graphic below: