New York City failed to collect nearly $60 million in revenue between fiscal 2011 and 2017 because the Department of Finance improperly credited a tax exemption intended for seniors to thousands of dead people and corporations, according to New York City Comptroller Scott Stringer.
The agency's failure continued unabated for years because it did not follow state tax law requiring any senior homeowner granted the exemption re-apply for the credit every two years, Stringer told reporters Thursday outside the David N. Dinkins municipal building in lower Manhattan.
"This lost revenue could have gone toward building the affordable housing we desperately need, or increasing resources for our school children," said Stringer. "Programs like the Senior Citizen Homeowners' Exemption help older New Yorkers to stay in their homes and remain in their communities. The city must ensure these tax breaks only go to those who deserve them."
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In total over those six years, said Stringer, the department improperly credited $59.2 million in tax breaks to 3,890 ineligible properties. About 83% of those properties received 17,354 exemptions after the homeowner had died.
These same properties, he said, were also incorrectly credited with an Enhanced School Tax Relief, or Star exemption, after the homeowner's death.
Stringer said 71 corporation-owned properties received 307 exemptions for which they were not eligible, and 573 properties that contained four or more units had the Senior Citizen Homeowners' Exemption applied to all units in their buildings, instead of only the one that qualified.
In six audits of the department since January 2014, Stringer's office has identified nearly $75 million in total lost revenue.
"These audits have made clear that the Department of Finance is not playing by the rules and it's taxpayers who have paid the price," said Stringer. "The city has an obligation to correct this mess ahead of the next tax season so that every New Yorker gets their fair shot."
