Tax impact of CO change (alt 1) but no change in property class

So the way taxes in NY are calculated is convoluted. My understanding is, with non-new housing stock, there’s the supposed market value, then they do a calculation and compute what the tax would be and then the actual tax is just a percentage of that number. Yes the amount you paid for a renovation probably gets figured in somehow, but in our case, the property’s supposed market value was low by like 20% when our taxes initial taxes came in. We bought for the price that was 20% higher so there’s a bump there. Then after we did work they reassessed and both our market value went up from the work done, plus the neighborhood went up, and as noted all the limits go out the window once you renovate, instead of being limited to customary 6% a year with a 20% limit. The combination meant we doubled in just a couple years. And it keeps going up year after year by 6% which is the maximum. I protested and noted that the comps nearby are for bigger properties with driveways, and that our place’s square footage was off. They corrected that info and said that the discount they giver our taxes based on the formula is still lower than what we were protesting and so they don’t correct it. which is standard practice.

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in General Discussion 5 years and 11 months ago

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wikhtacp | 5 years and 11 months ago

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Will my taxes be increased by 6% of reno costs or will the whole property be reassessed at current market value plus reno costs (even though my current market value + reno costs is much more than similar house are selling for in my area)? Most people seem to suggest that only 6% of the reno costs are added to the current artificially low assessment, but at least one has had experience with a CO change resulting in complete reassessment (that situation also involved a property class change). The latter scenario would be disastrous for us, so I am hoping to hear from people with real-life experiences in our situation to get a better sense of the tax impact ahead. Thanks in advance!

beneec | 5 years and 11 months ago

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I have no idea how the system works, but I do have one example:
We did an alt1 in 2016 on a house that did not have a cofo. It was a two fam and it became a 2 fam (with a cofo) Tax class did not change. I was concerned that our taxes would skyrocket, but they did not change.

wikhtacp | 5 years and 11 months ago

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Thanks for the response, Beneec. Did your architect/DOB examiner put down a cost for your job or was it just a CO issue and no renovations/permits were included?

beneec | 5 years and 11 months ago

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Yes, we did a large reno and the cost estimates (around 350k) were included in the filing.

Guest User | 5 years and 11 months ago

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You may find this forum thread useful:

https://www.brownstoner.com/forum/#!/?Your%20property%20tax%20might%20jump

wikhtacp | 5 years and 11 months ago

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Yes, that’s the thread that started my concerns and hence this thread. I have been in touch with that poster too (he’s the one who changed property classes that I mention in my post).

Lurker | 5 years and 11 months ago

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Counterpoint: Our taxes doubled two years after we did an alt 2 and have gone up 6% every year since.

Guest User | 5 years and 11 months ago

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@lurker – WOW! That’s the first I’ve heard of this. What was the scope of your renovation? Did it open up an entirely new tax assessment? Would love to talk if you have a moment or hear more about this. This kind of thing is my nightmare!

yudashasom | 5 years and 11 months ago

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@lurker, curious too. Did DOF come out?

randolph | 5 years and 11 months ago

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my house was a 2 family double duplex when we bought it and we did a gut renovation making it a triplex over single story apartment (alt1 and alt2 filings with DOB). as lurker says, about 2 years later our taxes slightly more than doubled and now they continue to go up a lesser amount each year (not sure if 6% or what, never did the math)

randolph | 5 years and 11 months ago

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> @beneec
> I was concerned that our taxes would skyrocket, but they did not change

I’d watch out this year!

wikhtacp | 5 years and 11 months ago

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Randolph–if you don’t mind my asking–what was the total job cost with DOB for the Alt 1 and 2? I am concerned they inflated our costs and everyone I spoke with had much lower costs on their permits than we did (even for more work). Did DOF essentially take 6% of your permitted costs and add that to the existing assessed value at the time? Or did they reassess your entire market value? With our costs as represented (unrealistically high)–our taxes would double if added to the existing assessed value but would triple if the entire value were reassessed with the added costs.

beneec | 5 years and 11 months ago

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Randolph, you may be right..
I agree with Augustiner in the original post that this is entirely unjust and punishes people who abide the rules, don’t lie about renovation costs and make their building safer for themselves, their tenant’s and their neighbors because they updated it to the current building code.

randolph | 5 years and 11 months ago

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> @
> what was the total job cost with DOB for the Alt 1 and 2

total amount listed across 3 permits (two alt2s and one alt1) was $330k.

taxes went from just under $2k to just over $4k. still very cheap compared to a condo and when you look at the market value of the house.

wikhtacp | 5 years and 11 months ago

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    string(0) ""
    ["user_status"]=>
    string(1) "0"
    ["display_name"]=>
    string(8) "wikhtacp"
    ["spam"]=>
    string(1) "0"
    ["deleted"]=>
    string(1) "0"
  }
  ["ID"]=>
  int(209520)
  ["caps"]=>
  array(1) {
    ["bbp_participant"]=>
    bool(true)
  }
  ["cap_key"]=>
  string(15) "wp_capabilities"
  ["roles"]=>
  array(1) {
    [0]=>
    string(15) "bbp_participant"
  }
  ["allcaps"]=>
  array(1) {
    ["bbp_participant"]=>
    bool(true)
  }
  ["filter"]=>
  NULL
  ["site_id":"WP_User":private]=>
  int(1)
}

Randolph, your taxes are half mine even post re-assessment! And I am sure your house isn’t much less valuable. I guess this confirms they just add the value of construction as opposed to RE-assess the entire property at current market value.