NEW YORK STATE (February 16, 2015) – Governor Andrew M. Cuomo has outlined new reforms in his 2015-16 Executive Budget designed to crack down on delinquent taxpayers and abuses of the STAR program. These steps include the outright suspension of those who owe more than $4,500 in back taxes from the STAR program, as well as empowering the state Department of Taxation and Finance to recover improperly granted STAR benefits.
“These reforms will ensure that STAR benefits will no longer be used to subsidize bad behavior and that they are received by only those property taxpayers who are entitled to them." Governor Cuomo said. "They build upon this administration’s efforts to increase the accuracy and fairness of the program and ensure this tax relief goes to those who need it the most."
The STAR program provides relief from school property taxes. It includes the Basic STAR exemption for homeowners with incomes under $500,000, and the Enhanced STAR exemption for seniors with income of $83,300 or less.
Currently, if a taxpayer owes more than $4,500 in state tax debt, the STAR benefit is applied to the individual’s tax debt. The Executive Budget will instead stop providing STAR benefits to any taxpayer who owes more than $4,500 in state taxes. The taxpayer can re-apply for STAR benefits once the tax debt is paid off.
The budget also authorizes the Tax Department to recoup STAR benefits from property owners who unlawfully received those state benefits in past years. Currently, that power resides with local assessors, who do not have immediate access to the same data as the Tax Department.
Since 2011, the Basic STAR exemption has been limited to households with incomes under $500,000. Subsequently, in 2013—the first year of the STAR Registration program—150,000 properties had their STAR exemptions removed due to income, residency or other ineligibility criteria.