Does filing an Alt-1 eliminate property tax assessment caps entirely?

Hello,

In the process of planning a renovation and can’t seem to find a full answer to this question. Would also appreciate referrals to people who can advise on this kind of thing professionally. Anyway, here goes:

Say you have a 2-family house and you get an alt 1 to change the division of the units.

Before the renovation:
– Estimated market value $2m (so assessed value would be 6% of $2m, or $120k, without caps)
– Taxable assessed value $40k due to caps

Which of these things will happen to your property tax assessment?

1. The city adds 6% of the value of the renovation onto your taxable assessed value. So if you do $100k of permitted work, now you’re taxed on ($100k * 6%) + $40k = $46k.

2. The city lifts the caps on taxable assessed value, so now you are taxed on $120k

3. The city lifts the caps on taxable assessed value AND adds the construction work, so you’re taxed on $126k

4. Something else entirely.

Appreciate the help!

Guest User | 7 years ago

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randolph | 7 years ago

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> @oliver_nyc
> hope this helps…

i did not follow this at all…….

anyway here is my experience: we did an alt 1 gut renovation, a year later our new C of O was issued (still a 2 family but with a different configuration), and the next year our taxes doubled. that is where we are now, not sure what happens next year. hoping that they do not continue to double but that seems to be the reality for some people.

oliver_nyc | 7 years ago

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we bought our house shortly after a renovation was completed. our market value increased by an amount slightly greater than the cost of the renovations (as reflected in the cost affidavit.) our notice stated what portion of the market value increase was due to the construction (in our case the increase was 90% due to this construction figure.) our assessed value then increased by the full 6% of the increase in market value (resulting in an overall increase in assessed value of around 40%!). so, long story short, our assessed value increased by 6% of the full increase in market value. so i guess best case scenario is that your market value increase is primarily from construction costs, but our case illustrates that the cap is definitely off and assessed value will increase by the full 6% of market value increase. the following year, we had no construction but an almost equal increase in market value and our assessed value did not increase by the full 6% (illustrating the cap was back on.) hope this helps…

midwoodflyer | 7 years ago

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You will be screwed. Don’t file permits. The system rewards rogue players and not those that do things by the books.

empathie00 | 7 years ago

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Sorry to say — DoF will do a brand new assessment and all caps are off. They can come up with whatever new value they think is appropriate.

resident2 | 7 years ago

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Go and speak to the tax assessor for your district. If you are in Brooklyn; I believe they are still in 210 Joralemon St.
At this time of year they normally have time to speak to drop ins.