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It looks like the city may have screwed thousands of New Yorkers out of a tax break that benefits condo and co-op owners, according to a report by Crain’s.
The confusion came about when tens of thousands of New York condo and co-op owners received letters from the Department of Finance telling them that a change to an existing tax abatement that was passed by the legislature this past January disqualified them from collecting the break.
The problem is that the new legislation disqualifies secondary residences – but the department erroneously sent the letters to thousands of primary residences, which still qualify for the full tax break.
The financial implications are huge, as those incorrectly excluded from break could lose out on an extra $1,000. Who or what to blame for the screw up was not entirely clear:
“Some people have been in their homes, 20, 30 or 40 years and are getting these letters,” said Mr. [Warren] Schreiber, [co-president of the Co-Op and Condo Council in northeast Queens]. “I think what happened is that the Department of Finance’s records are out of date, but it’s causing a lot of confusion and chaos.”
And it’s not the first time a mistake like this has happened. Nearly two years ago, Finance Commissioner David Frankel acknowledged the department had erred on 15,000 property bills the city mailed that July because of a “computer glitch.”
But in this case, a Department of Finance spokesman said the agency had used available data to determine which of the city’s 360,000 condo and co-ops would qualify for the abatement, and automatically enrolled 230,000 of them. In instances where there was not enough information, the agency sent out 130,000 of the letters to homeowners saying they were not eligible for the tax break.
Still, all hope is not lost for those who incorrectly received the letter disqualifying them from the break. The letter does inform residents to fill out a form by April 1 and mail it back to verify that their address is indeed their primary residence.
The Department of Finance stated that the letter was useful for updating their records, but it hasn’t stopped residents, especially the elderly, from getting anxiety that their financial planning may be out of whack.
Do you own a condo or a co-op and incorrectly receive a letter from the Department of Finance? Let us know. Oh, yeah, and let the DOF know, too.