Which Properties Are Eligible to Receive ICAP Tax Benefits?

Our clients frequently ask whether their projects are eligible for New York City’s widely used Industrial & Commercial Abatement Program (ICAP). Although developers and property-owners have been utilizing ICAP (as well as its predecessor, ICIP) for a number of years, the question of project’s eligibility remains somewhat tricky to answer. In this post we’ll discuss […]

It has been nearly a year since the City clarified the rules related to Affordable New York Housing Program (new 421-a). However, the developers of rental buildings are still struggling with the previously unfamiliar processes of Housing Lottery and tenant selection for income-restricted units.

A residential coop or condo unit qualifies for the abatement under RPTL Section 467-a (known as Coop/Condo Abatement), if all of the following are true.

Using one of the several appraisal methods allowed by state law, the City estimates the market value of each property. Once the market value is determined, the assessment ratio is applied in order to establish the portion of this value subject to taxation.

The system of real property assessment in New York City is complex. An interplay of state and local laws creates a revenue machine that produces over 20 billion dollars in property taxes every year.

The 421-a Tax Exemption law, originally enacted on July 1, 1971, was designed to spur economic and residential development in a faltering city. The program has now become synonymous with affordable housing.

All New York City real estate is subject to annual valuation. As outlined in our post on Assessment Basics, a property’s assessed value is determined by applying the assessment ratio to the property’s market value – finance’s estimate of your property’s worth.

The foundation of a successful appeal proceeding lies in accurate record keeping throughout the reporting period. Hence, the first step in the appeal process is to accumulate as much relevant information and evidence as possible.

The NYC Department of Finance (Finance) requires the Annual Real Property Income and Expense (RPIE) filing for most income-producing properties with an Assessed Value over $40,000.