Basic/Enhanced School Tax Relief (STAR)

State

New York

Year

2022

Variations in Receipt of Benefit

Benefit Varies with Taxes Due

Other Variation in Receipt of Benefits

Benefit Type

Credit

Exemption

Benefit

The School Tax Relief (STAR) program offers a school property tax exemption or a refundable state income tax credit. Since 2016, the exemption has been available only to those who received it in the previous tax year and new applicants have to apply for the credit. The credit is available to all qualified new applicants. Additionally, the credit and exemption programs both have an enhanced benefits option for seniors. The amount of the Basic STAR exemption is the base amount multiplied by the sales price differential factor. The base value is $30,000 and the sales price differential factor is the ratio of the 3-year average median sales price for residential property in the applicant's municipality to that of the state. This means that the basic exemption varies by municipality and is increased annually when home sales prices increase at a higher rate than the state average. The exemption amount is not allowed to decrease by more than 11% year-over-year. Likewise, the Enhanced STAR exemption program is the base amount multiplied by the sales price differential factor. The base value is $56,800 annually adjusted by the increase in the consumer price index for urban wage earners and clerical workers (CPI-W), and the sales price differential factor is the same as for the basic exemption. The savings resulting from the Basic or Enhanced STAR exemptions are limited to a 2% increase over the prior year. The amount of the Basic STAR credit is equal to the lesser of the applicant's school tax liability or the amount of tax savings that they would have received under the basic star exemption.

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 serves as the 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

Applicants must own the property and use it as their primary residence. Applicants for the basic STAR exemption must have a combined income of less than $250,000 and have received the STAR exemption for the 2015-2016 school year. Applicants for the enhanced STAR exemption must be 65 years old or older with a 2020 income less than or equal to $92,000 for 2022 benefits. Applicants for the basic STAR credit must have a combined income of less than $500,000. If the owners are legally married, only one must be at least 65 years old. A surviving spouse may qualify to continue the benefit if they are 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_RR22

Footnotes

Income eligibility for the 2022 STAR credit is based on federal or state income tax return information from the 2020 tax year. Applicants can switch from the STAR exemption to the STAR credit, but they may not switch back. 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 2022)
Source Constitution: 
NY CLS Const Art XVI, § 1
New York Department of Taxation and Finance, Application for Basic STAR Exemption for the 2022-2023 School Year, Form RP-425-B (August 2021)
[https://web.archive.org/web/20220308194523/https://www.tax.ny.gov/pdf/current_forms/orpts/rp425b_fill_in.pdf Accessed 10/12/2023]
View Archived Source

New York Department of Taxation and Finance, Application for Enhanced STAR Exemption for the 2022-2023 School Year, Form RP-425-E (August 2021)
[https://web.archive.org/web/20220513014716/https://www.tax.ny.gov/pdf/current_forms/orpts/rp425e_fill_in.pdf Accessed 10/13/2023]
View Archived Source

New York Department of Taxation and Finance, Supplement to Form RP-425-E Mandatory for all Enhanced STAR Applicants, RP-425-IVP (2020)
[https://web.archive.org/web/20220527052014/https://www.tax.ny.gov/pdf/current_forms/orpts/rp425ivp_fill_in.pdf Accessed 10/13/2023]
View Archived Source

New York Department of Taxation and Finance, Register for the School Tax Relief (STAR) Credit, RP-5310-FS (January 2022)
[https://web.archive.org/web/20220519095156/https://www.tax.ny.gov/pdf/star/rp-5310-fs.pdf Accessed 10/13/2023]
View Archived Source
New York Department of Taxation and Finance, STAR Resource Center (May 2022)
[https://web.archive.org/web/20220607180741/https://www.tax.ny.gov/star/ Accessed 10/12/2023]
View Archived Source

New York Department of Taxation and Finance, STAR Eligibility (May 2022)
[https://web.archive.org/web/20220704052013/https://www.tax.ny.gov/pit/property/star/eligibility.htm Accessed 10/12/2023]
View Archived Source

New York Department of Taxation and Finance, Administration of the STAR credit: common questions (April 2022)
[https://web.archive.org/web/20220728141713/https://www.tax.ny.gov/pit/property/star/star-administration-faqs.htm Accessed 10/13/2023]
View Archived Source

New York Department of Taxation and Finance, Calculating STAR exemptions
[https://www.tax.ny.gov/pit/property/star/starcalculation.htm Accessed 10/13/2023]
View Archived Source

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