NYC passed new laws last year, effectively phasing out tax abatements for condos and coops that are not used a primary residence. Which this doesn't affect anyone living in the apartments they own and live in, it affects investors greatly.
Here is the article about the law changes: http://www.nytimes.com/2013/03/26/realestate/tax-abatement-changes-affect-many-unit-owners.html?_r=0
But there is nothing mentioned specific about J51, or the changes to J51 itself. Is a J51 Tax abatement different than the standard condo/coop tax abatement? It sounds like it is to me, because the NYC.gov site lists them separately:
This the nyc.gov site stating its requirements for J51 does not mention primary residence as a requirement. The housing department and preservation stating its requirements for J51 does not mention it.
And then the nyc.gov mentioning the requirement for condo/co-op tax DOES mention the requirement for primary residence.
My understanding seems to be that they are different. But I can't be sure...
Does anyone have experience with this? Do you know any investors that have bought an unit in a J51 building?
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Response by needsadvice
about 12 years ago
Posts: 607
Member since: Jul 2010
This should plug a big hole in the tax base of this city.
The billionaires that own at One57 have a huge tax abatement, and I'll bet most don't live there.
If you're getting J51 or 421a, etc., you can't get the "Cooperative and Condominium Tax Abatement" at the same time. It'd kick in once your other abatements/exemptions expire.
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Response by rahm0277
about 12 years ago
Posts: 24
Member since: Jun 2013
Yeah - my broker and lawyer were no help. They told me contact an accountant. I need an accountant that is well versed in NYC real estate tax laws.... any references?
@NWT - I know, this is what is seems like - but some lawyers were adamant that they just don't apply to investors.
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Response by msadewitz
about 12 years ago
Posts: 20
Member since: Aug 2008
NWT is correct, at least according to the attorney I do most of my sales deals with. I asked him the same question a few months ago, and that's what he said. J51 and 421A are separate from the issue.
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Response by rb345
about 12 years ago
Posts: 1273
Member since: Jun 2009
1. J-51 is an old statute and is separate from the coop/abatement
2. but denying investors the abatement seeks unconstitutional, and
is inconsistent with Business Corporations Law section 501(c),
which applies to all Coop Corporations
This should plug a big hole in the tax base of this city.
The billionaires that own at One57 have a huge tax abatement, and I'll bet most don't live there.
Check out this $6 million apartment, with $110 in taxes:
http://streeteasy.com/sale/1053601-condo-157-west-57th-st-midtown-new-york
I have no answer to your question, but you could call the attorney that did your closing and ask him/her.
The "Cooperative and Condominium Tax Abatement" is a specific program, separate from J51 and all the other exemptions and abatements. See http://www.nyc.gov/html/dof/html/property/coop_condo_abatement.shtml
If you're getting J51 or 421a, etc., you can't get the "Cooperative and Condominium Tax Abatement" at the same time. It'd kick in once your other abatements/exemptions expire.
Yeah - my broker and lawyer were no help. They told me contact an accountant. I need an accountant that is well versed in NYC real estate tax laws.... any references?
@NWT - I know, this is what is seems like - but some lawyers were adamant that they just don't apply to investors.
NWT is correct, at least according to the attorney I do most of my sales deals with. I asked him the same question a few months ago, and that's what he said. J51 and 421A are separate from the issue.
1. J-51 is an old statute and is separate from the coop/abatement
2. but denying investors the abatement seeks unconstitutional, and
is inconsistent with Business Corporations Law section 501(c),
which applies to all Coop Corporations