Court Halts Tax Collection
Justice Wayne M. Ozzi of the New York State Supreme Court in Richmond County ruled on September 29 that NYC's pied-à-terre tax rollout was flawed and ordered the Department of Finance to take down the supplemental property roll and restart the notice process, according to Bloomberg and CNN.
The ruling found that the city's implementation shifted the burden of proof to homeowners, requiring them to prove they qualify for exemptions rather than the city proving they owe the surcharge. This violates due process protections, the court determined.
City Files Appeal, Invokes Stay
On the same day as the ruling, the city filed a notice of appeal and invoked a stay, allowing the pied-à-terre surcharge rollout to continue while the ruling is paused, according to CNN and Yahoo Finance.
The stay means property owners still face the October 6 deadline to file exemption claims, despite the court's finding that the process places an improper burden on them.
DOF Extends Deadline, Revises Notices
On October 1, the Department of Finance filed updated court papers extending the pied-à-terre exemption-claim deadline from September 18 to October 6 and said it was mailing revised notices to 1,210 owners after rechecking 2025 state tax data, according to The Real Deal and Thomson Reuters.
The revision affects owners whose properties were initially flagged for the surcharge based on state tax filing patterns that suggested non-primary residence status.
What This Means for Owners
Consider a Manhattan condo owner who received a pied-à-terre notice in August. Under the original timeline, they had until September 18 to file an exemption claim or face the surcharge on their next tax bill.
With the extension, that owner now has until October 6 to submit documentation proving primary residence status or another exemption category. However, the underlying legal challenge questions whether owners should bear this burden at all.
Legal Timeline Continues
This marks the second court intervention in the tax's rollout. On August 10, Justice Ozzi issued a temporary restraining order restricting the Department of Finance from taking certain rollout and enforcement actions, according to Baker Tilly and Venable.
The appeal process will determine whether the city's current implementation can proceed or must be restructured to address the court's due process concerns.
Frequently asked questions
What is the current deadline to file a pied-à-terre tax exemption claim?
The deadline is October 6, 2024. The Department of Finance extended this from the original September 18 deadline and mailed revised notices to 1,210 owners after rechecking 2025 state tax data.
Can the city still collect the pied-à-terre tax despite the court ruling against it?
Yes, the city filed an appeal and invoked a stay on the same day as the September 29 ruling. This allows the pied-à-terre surcharge rollout to continue while the court's ruling is paused.
Why did the judge rule against the city's pied-à-terre tax implementation?
Justice Wayne M. Ozzi found that the city's implementation shifted the burden of proof to homeowners, requiring them to prove they qualify for exemptions rather than the city proving they owe the surcharge. The court determined this violates due process protections.