New York State has amended Real Property Tax Law for the first time since 2010 for Section 467 and Section 459-c increasing the maximum income limit from $37,400 to $58,400 and simplifying the definition of income.

This substantially simplifies the definition of “income” for the senior citizens exemption and the exemption for persons with disabilities and limited incomes, beginning with the 2024 assessment rolls.

The new law requires an applicant’s income to be determined by taking the applicant’s Federal Adjusted Gross Income and applying the following adjustments:

1. Any taxable IRA distributions must be deducted – unless the municipality has opted to disallow this deduction
2. Any non-taxable Social Security benefits must be added – unless the municipality has opted to decline to add them
3. Medical and prescription drug expenses not reimbursed by insurance may be deducted if the municipality has opted to allow this deduction
4. Any tax-exempt interest must be added (this is not a local option)
5. Any losses claimed on the return may be limited (generally, the cap is $3,000 for each category of loss, and $15,000 in total; this is not a local option)

For most applicants who file federal income tax returns, the only document needed to prove income eligibility will be a copy of the return.

Supporting documentation generally should not be needed unless the applicant is seeking a deduction for unreimbursed medical and prescription drug expenses (and even then, supporting documentation might not be needed if the applicant chose to itemize deductions on their tax return).

Low-income applicants who do not file tax returns will need to demonstrate their income eligibility by completing a worksheet prescribed by the Tax Department (Form RP-467-Wkst or RP-459-c-Wkst).

The new law also clarifies that where the local taxable status date is earlier than April 15, the “applicable income tax year” is the second-latest calendar year; elsewhere, it is the latest calendar year. However, for a “fiscal year” filer, the latest return should be used.

Further information about this new law may be found on the Tax Department’s website.

SOURCE: https://www.tax.ny.gov/pdf/publications/orpts/legis/legsum23.pdf

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Feb 1, 2024