New York State Assembly - How the STAR Program Can Lower Your Property Taxes

Assembly Speaker Sheldon Silver
270 Broadway, Suite 1800, New York, NY 10007 (212) 312-1400
Room 932 LOB, Albany, NY 12248 (518) 455-3791

(Note: You may download the STAR application form from the Assembly web site. The form is in Adobe PDF format, so in order to view or print it you will need, if you have not already done so, to install the free Adobe Acrobat Reader software, which can be downloaded from Adobe's web site.)

What is STAR?

STAR is the New York State School Tax Relief program that provides an exemption from school property taxes for owner-occupied, primary residences. This state-financed exemption is authorized by section 425 of the Real Property Tax Law.

Starting with the 1998-99 school year eligible senior citizens can get a break on school taxes under the “enhanced” STAR exemption. To be eligible, property owners must be 65 years of age or older with incomes that do not exceed $60,000 a year. For property owned by a husband and wife, only one of them has to be at least 65 years of age. Their combined annual income, however, must not exceed $60,000.

That refers to the STAR exemption available to senior citizens whose incomes do not exceed $60,000. Seniors will receive at least a $50,000 exemption from the full value of their property. The “enhanced” STAR exemption will provide an average school property tax reduction of at least 45 percent annually for seniors living in median-priced homes. Senior citizens whose annual incomes exceed $60,000 will be eligible for the “basic” STAR exemption.

When will the STAR exemption be available for other residential property owners?

The “basic” STAR program will be extended to all primary-residence homeowners, regardless of age or income, starting with school year 1999-2000. The “basic” exemption will begin with at least a $10,000 full-value assessment exemption in school year 1999-2000 and will be phased in over three years to at least $30,000 in school year 2001-02.

The “basic” STAR exemption will be available to all residential property owners, regardless of age or income, starting in school year 1999-2000. When the basic exemption is fully phased in, they will receive at least a $30,000 exemption from the full value of their property. The exemption will begin with at least a $10,000 full-value exemption in school year 1999-2000, and be phased in over three years to at least $30,000 in school year 2001-02. By then, the “basic” STAR exemption will be providing an average school property tax reduction of at least 27 percent annually for persons living in median-priced homes.

How will I know how much my STAR exemption is worth in terms of tax dollars?

Your school tax bill will state the amount of the STAR exemption and your savings. This information will be included as a result of a new “Property Taxpayer’s Bill of Rights” that also is part of the STAR program and will be used for the first time with school property tax bills for 1998-99.

Other information on the new tax bill or an optional ‘Bill of Rights’ notice will include the market value of your property; the percent of market value used in assessing property in your locality; the total tax levy and percent change from the prior year; and how to seek an assessment reduction through the grievance process if you believe your property’s assessment is too high.

The STAR exemption applies only to school district taxes. It does not apply to property taxes for other purposes, such as county, town or city.

How is the STAR exemption computed in places that do not assess properties at their full, market value?

The STAR exemption will be adjusted by use of State equalization rates to reflect the fractional level of assessment in localities that do not assess property at full, market value.

To be eligible for either the “enhanced” or “basic” STAR exemption, persons must own and live in a one, two, or three-family residence, mobile home, farm home, condominium or cooperative apartment.

There is no one single factor that determines whether a property is your primary residence, but factors such as voting, vehicle registrations, and length of time spent each year on the property may be relevant. The assessor may ask you to provide proof of residency with the application. In addition, the assessor may occasionally request proof of residence after the exemption has been granted to verify that the property remains your primary residence.

A mixed-use property is eligible for the exemption if it is the owner’s primary residence.

I own more than one residential property. Can I receive the STAR exemption on all the residences I own?

I currently receive an “over 65” property tax exemption under section 467 of the Real Property Tax Law. Am I entitled to both this exemption and the new STAR exemption?

Yes. Low-income seniors who will be receiving the pre-existing senior citizen’s exemption automatically qualify for the STAR exemption. As a result, they need only to file and qualify for the pre-existing exemption, and they will receive both that exemption and the STAR exemption.

The new STAR law also requires that assessors apply the pre-existing senior citizen exemption and any other applicable exemption to the property’s assessed value before applying the STAR exemption. This will result in greater exempt amounts for eligible senior citizens.

I am a senior citizen who is not eligible for the “over 65” exemption but my income does not exceed $60,000. How do I get the STAR exemption?

If you are a senior whose property is not receiving an “over 65” senior citizen exemption, your property may still be eligible for the “enhanced” STAR exemption, but you must apply for it with the local assessor, not the state. If your application is granted, you then must reapply each year thereafter in order to keep the enhanced exemption in effect.

What is the process for non-seniors or seniors whose combined incomes exceed $60,000?

They must file a completed application form for the “basic” STAR exemption with their local assessor. The STAR exemption is a state-funded program, but the form must be filed with the local assessor, not with the state. It is the local assessor who has the responsibility for reviewing the application and determining eligibility.

Property owners who are granted the “basic” STAR exemption generally will not need to reapply in subsequent years. However, they will need to notify their assessor if their primary residence changes.

The application form is RP-425 is available at the offices of local assessors. Additional locations and deadline reminders will be advertised.

Yes. The deadline for STAR applications (both "enhanced" and "basic") is the "taxable status date" which is the date your assessor must finalize your assessment and exemption information.

For example, the taxable status date in New York City is January 5th, so that date is the deadline for filing the STAR application in New York City. Remember, the taxable status date varies in each assessing jurisdiction so check with your city or town assessor for your local STAR application deadline.

Where do I file the application form?

With your local assessor. Do not file the application with the New York State Office of Real Property Services or any other State agency.

Yes. The first time you, a senior citizen, apply for the STAR exemption, you must give satisfactory proof of age, such as a birth certificate or baptismal certificate. If those documents are unavailable, you may furnish a hospital birth record, an affidavit of age from the Social Security Administration, marriage record, passport, military record, immigration documents or other reliable records that show your age. Remember, for property owned by a husband and wife, only one of them has to be at least 65 years old by the filing deadline (taxable status date).

Homeowners applying for the “basic” exemption do not have to supply proof of age.

Yes, but only for those property owners who are applying for the “enhanced” STAR exemption available to senior citizens whose incomes do not exceed $60,000. Remember, for property owned by a husband and wife, their combined annual income must be no greater than $60,000. Be sure to attach to your application form copies of your latest federal or New York State income tax return, in addition to proof of age.

For 1998, your income for STAR purposes is not necessarily the same as your income for federal or state income tax purposes. However, starting in school tax year 1999-2000, your income for STAR purposes is the same as your income for federal income tax purposes, less distributions from IRAs or individual retirement annuities.

To show income, provide a copy of your latest federal or state income tax return, which is kept confidential.

Homeowners applying for the “basic” STAR exemption do not have to supply any proof of income.

May the STAR exemption be granted if the property has been placed in a trust?

Are the income documents I submit with my STAR application kept confidential?

Yes, the law requires your income information to be kept confidential by the local assessor and any municipal officer or employee. Violations will be subject to penalty under the General Municipal Law.

Would an otherwise qualified person remain eligible to receive the STAR exemption if he or she, by deed, reserved a life estate and granted someone a remainder interest in the property?

Yes. The holder of a life estate is entitled to possession and use of the property for the duration of his or her life and is deemed to be the owner for all purposes, including taxation. The rights of the recipient, with respect to ownership of the property, do not come into being until the death of the life tenant.

The exemption is not transferred automatically. You will have to apply for the exemption on your new primary residence.

Yes, there is a penalty for material misstatements. Anyone who misrepresents his or her primary residence, age or income may be subject to a $100 penalty, may be prohibited from receiving the STAR exemption for five years, may have to return up to three years of tax savings, and may be subject to criminal prosecution.

You can contact Assembly Speaker Silver by e-mail at speaker@assembly.state.ny.us, by phone in New York City at (212) 312-1400, and in Albany at (518) 455-3791. For local information about the STAR program, contact your town assessor's office.