As autumn arrives in New York City, property owners face an important deadline: the filing of Real Property Tax Law (RPTL) Article 7 petitions. If you’ve challenged your property’s assessed value with the NYC Tax Commission and are unsatisfied with the outcome, it’s crucial to understand your options for judicial review. In this blog post, we’ll explore why we file Article 7 petitions, what we typically allege, and key details about the filing process.
Why Do We File Article 7 Petitions?
After submitting an application for correction to the NYC Tax Commission, you might receive an offer of relief—a proposed reduction in your property’s assessed value. If you do not accept this offer by the specified deadline, or if the offer is withdrawn, the original tentative assessment becomes final. At this juncture, administrative remedies are exhausted, but the law provides a judicial pathway for further action.
Seeking Judicial Review
Under Article 7 of the New York Real Property Tax Law and Section 11-231 of the NYC Administrative Code, property owners have the right to seek judicial review of their property’s assessment. This involves filing a petition with the New York State Supreme Court in the county where the property is located, no later than October 24th of the tax year in question. The courts do not defer to the Tax Commission’s determinations, allowing for an independent assessment of your case.
The Effect of Commencing a Proceeding
It’s important to understand that commencing an Article 7 proceeding does not halt the City’s ability to levy, collect, or enforce taxes based on the final assessment confirmed by the Tax Commission. The initiation of a judicial review does not result in an automatic reduction of your assessment for the following tax year. If the Tax Commission does not reduce the assessment in subsequent years, you will need to file new applications or petitions for each year you wish to challenge.
Tax Commission Actions in Subsequent Years:
- Authority Over Multiple Years: If you commence a proceeding for the current tax year and also file an application for correction for the next tax year, the Tax Commission has the authority to review assessments for both years.
- Settlement Contingencies: If you retained an attorney to commence a proceeding and later receive an offer of reduction from the Tax Commission for a subsequent year, the offer may be contingent upon prompt discontinuance of the prior proceeding.
- Role of Attorney of Record: Only the attorney who initiated the prior proceeding can discontinue it. Even if you represent yourself or hire a different representative in later dealings, the original attorney must provide the legal documentation to discontinue the previous case.
Abandonment of Proceedings:
- Four-Year Rule: If no action is taken after filing the petition, such as moving the case forward in court, the petition may be deemed abandoned after four years and dismissed. This emphasizes the importance of actively pursuing your case once a proceeding has been initiated.
The Cost of Filing
Filing an Article 7 petition involves certain fees:
- Filing Fee: The cost to file a petition is $210.
- E-Filing Processing Fee: If you choose to file electronically, the court charges a 2.99% credit card processing fee, bringing the total to $216.28.
It’s important to account for these costs when considering judicial review.
Who Can File and Sign a Petition?
Understanding who is eligible to file and sign an Article 7 petition is crucial for ensuring your case is heard.
Eligibility to File
- Property Owners: Any person or corporation claiming to be aggrieved by an assessment can file a petition.
- Authorized Agents: An authorized agent may file on behalf of the property owner, provided they have written authorization included in the petition.
- Condominium Boards: Under RPTL §704(5), condominium boards of managers can act as agents for unit owners, allowing the condo association to file one petition that covers all the condo lots.
Who Can Sign the Petition?
- Individual Owners: If you own the property individually, you can sign the petition yourself.
- Corporate Entities: For corporations, an officer of the company must sign the petition.
- Verification Requirement: The petition must be duly verified, meaning it must be sworn to be true under oath and notarized.
Legal Representation
- Attorney Requirement for Corporations: Corporations and other legal entities must be represented by an attorney in court proceedings.
- Self-Representation: Individual property owners may represent themselves but should be familiar with legal procedures and requirements.
What Must Be Included in the Petition?
An Article 7 petition must adhere to specific legal requirements:
- Description of the Property: Include the property’s address, borough, block, and lot numbers as listed on the tax map.
- Assessment Details: State the current assessed value and the tax year in question.
- Grounds for Review: Clearly specify the reasons why the assessment is incorrect (e.g., excessive assessment, inequality, illegality, misclassification), as outlined in NYC Administrative Code §11-231.
- Verification: The petition must be verified by the petitioner or an authorized agent, and the verification must be notarized.
- Index Number: Obtain an index number from the county clerk prior to serving the petition.
- Filing Deadline: File the original verified petition with proof of service in the office of the court clerk within ten days after commencing the proceeding.
What Do We Allege in the Petition?
In your petition, you’ll need to allege specific grounds for why the assessment should be reduced or corrected. Common allegations include:
- Excessive Assessment
- Definition: The assessed value exceeds the property’s fair market value.
- Argument: The property would sell for less under normal market conditions than the value assessed.
- Inequality
- Definition: The property is assessed at a higher percentage of its value compared to similar properties.
- Argument: Your tax burden is unfairly high relative to comparable properties on the same tax roll or within the same class.
- Illegality
- Definition: The assessment is unlawful due to procedural errors or statutory violations.
- Argument: Errors in the assessment process, such as failure to provide proper notice or misapplication of tax laws.
- Misclassification
- Definition: The property is incorrectly classified, affecting its tax rate.
- Argument: For example, a commercial property has been misclassified as residential.
- Denial of Exemptions
- Definition: The property qualifies for tax exemptions that were not applied.
- Argument: Failure to account for exemptions leads to an excessive taxable value.
Combining Multiple Properties in One Petition
If you own multiple properties located in the same borough and they are owned by the same petitioner, you can combine them into one petition. This can simplify the filing process and potentially reduce legal costs. However, it’s important to ensure that all properties included in the petition are accurately described and meet the criteria for consolidation.
Condominium Associations
When condominium boards of managers file on behalf of the unit owners, the condo association can file one petition that covers all the condo lots. This collective approach allows the condominium to challenge assessments affecting the entire property, streamlining the process for individual unit owners. The board acts as an agent for the unit owners, representing their collective interests in the proceeding.
Understanding the Legal Grounds
The legal foundation for these allegations is grounded in RPTL Article 7 and NYC Administrative Code §11-231, which outline the rights and procedures for challenging property assessments. Key sections include:
- RPTL §700: Establishes the right to judicial review of property assessments.
- RPTL §706 and NYC Administrative Code §11-231(b): Specify the grounds for review and the required contents of the petition.
- RPTL §704 and NYC Administrative Code §11-231(a): Describe the process for commencing a proceeding by filing a verified petition with the court.
The Importance of Legal Representation
Filing an Article 7 petition involves complex legal procedures and strict deadlines. While individual property owners may represent themselves, it is highly advisable to consult with an attorney who specializes in property tax law. An experienced lawyer can:
- Ensure Compliance: Help you meet all legal requirements for the petition.
- Articulate Your Case: Effectively present your allegations and supporting evidence.
- Navigate the Process: Guide you through court procedures and negotiations.
Conclusion
Challenging your property’s assessment through an Article 7 petition is a critical step in ensuring you’re not overpaying property taxes. By understanding why we file these petitions, who can file them, and what must be alleged, you can take informed action to advocate for a fair assessment. Remember, the deadline is October 24th, so if you’re considering this route, it’s essential to act promptly.
Disclaimer: This blog post is for informational purposes only and does not constitute legal advice. For assistance with filing an Article 7 petition, please consult a qualified attorney.