State to eliminate STAR benefits for homeowners that fail to pay property taxes

Governor Andrew M. Cuomo recently announced a proposal in the FY 2021 Executive Budget to deny School Tax Relief Program benefits to delinquent property owners. The measure would eliminate STAR benefits for homeowners that do not pay their property taxes. It would also require localities to report tax delinquents to the Department of Taxation and Finance so that a STAR credit or exemption can be withheld. Homeowners will be excluded from the STAR program until past-due property taxes are paid.

“These benefits are meant to help responsible taxpayers pay their school tax bill, and if someone is not paying their fair share, they should not be entitled to STAR – period,” said Governor Cuomo, adding, “By closing this loophole, New York will crack down on bad actors and help ensure these benefits go toward the hardworking taxpayers who deserve them.” 

Commissioner of Taxation and Finance Michael Schmidt said, “Only those homeowners who pay their property tax bills should receive the STAR benefit. Governor Cuomo’s proposal will help ensure that STAR only goes to those who deserve it, promoting property tax compliance and creating a fairer system for homeowners across the State.”

In 2013, Governor Cuomo enacted reforms to the STAR program to crack down on delinquent taxpayers, including barring property owners who made a material misstatement on a STAR exemption application from receiving the exemption for six years. In 2015, the State Department of Taxation and Finance was authorized to recoup STAR benefits from property owners who unlawfully received those state benefits in past years, a power that previously resided with local assessors only.

The STAR program provides $3.4 billion in relief from school property taxes. It includes the Basic STAR credit benefit for homeowners with incomes of $500,000 or less, the Basic STAR exemption benefit for homeowners with incomes of $250,000 or less, and the Enhanced STAR benefit for seniors with incomes of $88,050 or less.