Cooperative and Condominium Tax Abatement

The Cooperative and Condominium Tax Abatement Program provides partial tax relief for condo owners and co-op tenant-shareholders to reduce the disparity in property tax paid between residential Class 2 properties (i.e., condominiums and cooperatives) and Class 1 properties (i.e., one-, two-, and three-family homes), which are assessed at a lower percentage of market value.

Eligibility and Requirements
Level of Benefit
Forms and Publications
Deadline
Frequently Asked Questions (FAQ)

Eligibility

• Ownership -- Condominium owners and cooperative tenant-shareholders who, as of the applicable taxable status date, may own no more than three dwelling units in any one property. Units held by sponsors or their successors in interest are not eligible.
• Other Exemptions -- Properties that already receive a state or local tax exemption or abatement, such as J-51 Exemptions, 421a, 421b, or 421g may not be eligible.

Requirements
New cooperative and condominium developments can apply for the abatement. The development's Board of Directors, managing agent, or other official representative of the development must complete the abatement application.
Condominium/Cooperative Property Tax Abatement
Application and Instructions

Individual unit owners/shareholders can apply for the abatement and other property exemptions by completing the Exemption and Abatement Application for Owners. 
Tax Reductions for Individual Property Owners
Exemption and Abatement Application for Owners

Level of Benefit
The abatement granted to eligible units is based on the average assessed value in the building, as indicated in the chart:

Forms & Publications

Condominium/Cooperative Property Tax Abatement Application and Instructions
 Download Application (57k)

Co-op and Condo Property Tax Abatement Program Owners Guide
 Download Brochure (1.5M)

Deadline
The application deadline for the 2009/2010 abatement is
February 15, for the benefits to begin July 1st of the same year.

How Finance Determines Your Abatement

Abatements are determined based on the value of the entire cooperative. For condominiums this total value is allocated among the eligible units and the assessed value of the property is reflected on the quarterly Statement of Account (SOA).  For a cooperative development, the assessed value of the unit is calculated by: 1) dividing the entire development's assessment by its total number of shares and then 2) multiplying each unit's number of shares by that factor. The abatement is only granted to the shares of eligible residential units. Properties receiving any of the following exemptions ineligible for the Co-op/Condo Abatement: the J51 exemption, 421a, 421b, Housing Development Fund Corporation (HDFC); Division of Alternative Management Programs (DAMP) and the Limited Divided Housing Companies, Redevelopment Companies and Mitchell-Lama. The 421g abatement also makes the development ineligible for the co-op/condo abatement. 

Frequently Asked Questions (FAQ)

Who can apply?
The cooperative and condominium Board of Directors or their managing agents must file an abatement application on behalf of the entire development only in cases where the developments are new.

Individuals can apply for their portion of the benefit only after the entire building is approved by completing the Exemption and Abatement Application for Owners.

The abatement is available to all residential co-op and condo units, with the exception of units owned by sponsors, or owned by persons who own more than 3 units in the development, and those used for non-residential purposes.

When to apply?
Abatement applications must be filed by cooperative and condominium Board of Directors or their managing agents by February 15, for the benefits to begin July 1st of the same year.  Individual owners/shareholders who complete the Exemption and Abatement Application for Owners can apply throughout the year however if we receive your application by January 5th, benefits will begin by July 1st of the same year.

What is the effective date of the information?
All information provided on the tax abatement application must be accurate as of January 5, for their portion of the benefit only after the entire building is approved .

Who is responsible for new owner filing?
The managing agent or Board of Directors is responsible for sending new owner information to Finance.  New owners must notify their managing agents or Board of Directors after purchasing their unit and provide them with the following information: new owner’s name, new owner’s social security number, previous owner’s name, amount paid for the unit, and the date of sale.

Who receives the partial abatement?
The partial tax abatement for cooperatives will be applied to the entire development’s property tax bill, called the Statement of Account (SOA).  Finance will notify the Cooperative’s Board of Directors or the managing agent as to the amount of benefit to be credited to each eligible unit. The Board of Directors will be responsible for applying the reduction to the eligible residential units.

When will eligible units receive the abatement for the current tax year?
If the Condominium/Cooperative Property Tax Abatement application is received by February 15, Finance will credit the sum of all abatements and exemptions for eligible cooperative units against the development's SOA, effective July 1st.  In the fall, each development will receive a listing of benefits attributable to each unit.  Eligible condominium units will also see the abatement reflected on their quarterly SOA, effective July 1st.


My neighbor and I purchased our units on the same day - Why did they receive a tax abatement and I didn’t?
Unit eligibility is determined by the prior owner’s abatement status, as of January 5th, for the tax year beginning July 1st. Therefore, if the unit you purchased was ineligible for the abatement at the time of purchase, you were not eligible to receive the abatement.  Your neighbor’s unit was eligible for the abatement at the time of their purchase, so they received the abatement.


My Managing Agent applied a special assessment to our cooperative and kept the tax abatement. Are they allowed to do so?
The cooperative/condominium Property Tax Abatement must be credited to each eligible unit. However, for example, if the managing agent made an assessment of $1,000 to offset fuel expenses on all units, the co-op board is within its rights to reduce or partially offset the tax abatement for an eligible unit. Units that are ineligible for the abatement would have to pay the full $1,000 assessment.


Why is my abatement different from my next-door neighbor who has the same number of shares?
Co-op/Condo tax abatements are calculated by using the final taxable amount. The amount is calculated to include exemptions/abatements. See example provided in the section: How Finance Determines Your Abatement. For example, if your neighbor has a Senior Citizen Homeowners (SCHE), Veteran, STAR, or other exemption, these benefits are deducted, which results in a final taxable amount that may be lower than yours if you do not have these exemptions. Then the tax abatement rate is applied. As a result, your neighbor’s tax would be different than yours.


Should my parking space or the maid’s room be calculated as a unit?
Any space you utilize that has shares assigned (cooperative) or a unit lot number (condominium) is considered and calculated as a unit.


What is the proper way to credit cooperative owners their tax abatement? Can I, as an owner, request a check directly from Department of Finance?
Abatements are applied towards the Statement of Account for the entire co-op. Checks are not issued from the Department of Finance to owners or to managing agents. The managing agents will credit units according to the development’s approved by-laws.


Do I have to report the abatement on my taxes?
Income taxes are a unique and personal responsibility of each individual. Income tax questions should be submitted to an accountant for clarification.

Contact Us
Email Co-op / Condominium Tax Abatement Program