Watch Your Mail For A Star Refund Check In October…Maybe It Will Come

If you previously registered for a STAR refund, New York State (“NYS”) will be issuing STAR refund checks for Nassau County homeowners in October. What is STAR? Am I eligible for a refund? How do I receive the refund?

The School Tax Relief (STAR) program offers property tax relief to eligible NYS homeowners. In general, life estates and trusts are eligible for STAR relief as well. You only need to register once, but must do so again if the form of your home ownership changes, e.g. from joint ownership to a trust. To register, follow this link: www.tax.ny.gov/star . If you are eligible and enrolled in the STAR program, you’ll receive your benefit each year in one of two forms:

• STAR credit check: If you registered for the STAR credit, the NYS Department of Taxation and Finance will send you a STAR check in the mail each year. You can receive the STAR credit if (a) you own your home; (b) the home is your primary residence; and (c) the combined income of the owner and the owner’s spouse is $500,000 or less.
• STAR exemption: a reduction on your school tax bill. If you’ve been receiving the STAR exemption since 2015, you can continue to receive it for the same primary residence. As long as you remain eligible, you should receive a reduction on your school tax bill for the amount of your STAR exemption. You don’t receive the value of the exemption as a refund check, but as a reduction in assessment on your school tax bill. Coincidentally, Nassau County homeowners will receive their first half school tax bills in October, so you will be able to readily see if you received this exemption.

If you and your spouse’s combined income is less than $250,000, you will in all likelihood receive the exemption, rather than the credit. An eligible homeowner can register to receive the credit rather than the exemption, but the deadline to do so for Nassau County homeowners (with the exception of Glen Cove homeowners) is mid-March. (The Glen Cove deadline is approximately July 1.)

Why switch? If you currently receive your STAR benefit as a reduction on your school tax bill (the STAR exemption), you may receive a greater benefit if you switch to the STAR credit to receive a check instead. The value of the STAR credit savings may increase by as much as 2% each year, but the value of the STAR exemption savings cannot increase. The STAR exemption savings can never be higher than the STAR credit savings. Whether you’re receiving the STAR credit or exemption, the benefit can change each year due to a variety of factors, including school tax rates, changes in property values in your community, and local assessment practices.

As a result, the STAR credit benefit may not always increase, and when it does increase, it may do so by 2% or less. However, the STAR exemption benefit can never increase, even when the STAR credit benefit does increase.  The STAR exemption benefit will never be higher than the STAR credit benefit. If you wish to switch, follow this link:  https://www8.tax.ny.gov/STRP/strpGateway

If you are a senior citizen, the Enhanced STAR exemption provides an increased benefit for the primary residences of those age 65 and older with qualifying incomes of $90,550 or less for the 2021-2022 school year, and $92,000 or less for the 2022-2023 school year. To have your Basic STAR exemption upgraded to the Enhanced STAR exemption, you must submit the following to your assessor:

• RP-425-IVP, Supplement to Form RP-425-E (include the Social Security numbers of all owners of the property and any of their spouses who reside at the property) (link: https://www.tax.ny.gov/pdf/current_forms/orpts/rp425ivp_fill_in.pdf ), and
• RP-425-E, Application for Enhanced STAR Exemption (link: https://www.tax.ny.gov/pdf/current_forms/orpts/rp425e_fill_in.pdf ) .

If you have any questions regarding reducing the assessment on your home or commercial property you may own, please contact Martin E. Valk, Esq.