Basic/Enhanced School Tax Relief (STAR)

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State

New York

Year

2021

Variations in Receipt of Benefit

Benefit Varies with Taxes Due

Other Variation in Receipt of Benefits

Benefit Type

Credit

Exemption

Benefit

The Basic STAR program exempts the first $30,000 of full value from school taxes. The Basic value is subject to an annual adjustment based on local housing prices. The Enhanced value is annually adjusted by the increase in the consumer price index for urban wage earners and clerical workers (CPI-W). The savings resulting from the Basic or Enhanced STAR exemptions are limited to a 2% increase over the prior year. Within each municipality, the maximum savings may vary by school district and/or class. The program is converted from an exemption benefit program to a credit program. All new applicants receive an income tax credit of the same value rather than a reduction (exemption) of their school taxes.

How is Benefit Disbursed

Exemption from assessed value

Eligible Property Type

Residential

Characteristics of Eligible Property

Property must be a one-, two-, or three-family residence, a farm home or a residential condominium or cooperative apartment that must serve as a primary residence of one or more of the owners. The exemption may be granted to a portion of any other type of property that is partially used by the owner as a primary residence.

Eligibility Criteria

Age

Homeowner

Income Ceiling

Principal Residence

Surviving Spouse

Description of Eligibility Criteria

All primary residence homeowners with income less than $250,000 are eligible for the Basic STAR exemption. Those with incomes below $500,000 are eligible for the Basic STAR credit. Applicants of the Enhanced STAR program must be at least 65 years of age with an income less than or equal to $88,050 in 2018 for 2020 benefits. If the owners are legally married, only one must be at least 65 years old. A surviving spouse must be 62 years of age or older.

Local Option in Adoption of Program

Local government is unable to exercise an option

Local Option Regarding Program Features

No local option regarding program features

State Funding for Local Tax Loss

State reimburses all of the local government tax loss

Description of State Funding for Tax Loss

The state reimburses directly to the school districts and also provides administrative reimbursements to the local governments that process STAR exemptions.

Record ID

NY104_RR21

Footnotes

The income limit established by the basic STAR exemption will no longer be taken into account when determining eligibility for the basic STAR credit. Basic STAR exemption income limit changed to $250,000 from $500,000. This was enacted by 2019 N.Y. Laws ch. 59 § RR-2. Effective for applying in 2019, qualified individuals who did not file an income tax return prior to 2019 will still be eligible for exemption in the 2019 tax year so long as they file a statement to the New York State Department of Taxation that verifies their source(s) of income. This was enacted in 2018 N.Y. Laws ch. 59 § B-1 (SB 7509). The STAR program is converted from an exemption benefit program to an income tax credit program. The exemption program is closed to new applicants. All new applicants receive an income tax credit of the same value rather than a reduction on their school tax bill. For the Basic STAR, in counties where the median home value is higher than the statewide median home value, the exemption or credit is increased proportionally so that homeowners in these areas will realize equivalent tax relief. Residents of NYC while not eligible for STAR relief, a flat rate benefit, unrelated to property tax is available.

Sources

N.Y. R.P.T Law § 425
N.Y. Tax Law §606(eee) (in effect for 2021)
Source Constitution: 
NY CLS Const Art XVI, § 1
New York State Department of Taxation and Finance Office of Real Property Tax Service, Application for Basic STAR Exemption for the 2021-2022 School Year RP-425-B, (2020)
[https://www.tax.ny.gov/pdf/current_forms/orpts/rp425b_fill_in.pdf Accessed 11/15/2021]
View Archived Source

New York State Department of Taxation and Finance Office of Real Property Tax Service, Application for Enhanced STAR Exemption for the 2021-2022 School Year RP-425-E, (2020)
View Archived Source

New York State Department of Taxation and Finance, Questions and Answers for Homeowners about the New STAR Credit Program, (2020)
[https://www.tax.ny.gov/pit/property/star/star-administration-faqs.htm accessed 11/15/2021]
View Archived Source

New York State Department of Taxation and Finance, Register for the School Tax Relief STAR Credit Information, (2020)
[https://www.tax.ny.gov/pdf/star/rp-5310-fs.pdf accessed 11/15/2021]
View Archived Source

New York State Department of Taxation and Finance, Register for the School Tax Relief STAR Credit, (2019)
[https://www.tax.ny.gov/pit/property/star/default.htm accessed 11/15/2021]
View Archived Source

New York State Department of Taxation and Finance, STAR Eligibility Information, (2020)
[https://www.tax.ny.gov/pit/property/star/eligibility.htm accessed 11/15/2021]
View Archived Source

To reference this webpage/table, please use the following citation:

Significant Features of the Property Tax. https://www.lincolninst.edu/residential-tax-relief/basicenhanced-school-tax-relief-star-new-york-2021 Lincoln Institute of Land Policy and George Washington Institute of Public Policy. (Basic/Enhanced School Tax Relief (STAR) ; accessed: 12/07/2023 06:22:28 AM)

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