New  York State’s School Tax Relief Program, the “STAR Exemption,” can provide a reduction on your real property school tax on your primary residence.  There are two types of STAR exemptions; Basic and Enhanced.  The latter is in addition to the Basic exemption for people 65 and older and with income of $81,900.00 or less.  Eligibility for the “Basic” Star exemption, applies to owners of a house, condominium, or cooperative apartment if (i) it serves as your primary residence and (ii) the combined income of the owners is $500,000 or less (income being equal to your federal adjusted gross income, less the taxable amount of total distributions from IRA’s).

The Enhanced STAR exemption required annual registration and qualification.  Not so for the Basic STAR, UNTIL THIS YEAR.  If you want your Basic STAR to renew for 2014, you will have to register for renewal before December 31, 2013.

Until this year, your Basic STAR exemption renewed automatically.  But someone with a grasp of the obvious in the Tax Department figured out that people did not volunteer to cancel their Basic STAR exemption if circumstances changed after they got it.  Owners conveniently use the “don’t ask, don’t tell” policy.  If the state did not ask each year if the property served as a primary residence, or whether income exceeded $500,000, why tell the state?  So the Tax Department decided it would ask, and you have to tell.  The new online registry is also expected to  weed out those who take multiple Basic STAR exemptions – by that I mean owners who consider their “primary” weekend residence, just as primary as their primary residence.

This is all well and good for the honest folks like us.  But rest assured New York State and your school district won’t be at all upset if simply overlook renewal. Don’t be one of them!

Renewal can take just a couple of minutes.  If you currently have the Basic STAR, you should have received a notice from the New York State Department of Taxation and Finance that went out in September. You renew on line at httpss:// .  The notice you were sent gives you your own Basic STAR code. Just plug in the code and follow the prompts.  If you can’t find your code, there are prompts to help you get it.

For those of you that took advantage of the STAR exemption and were not supposed to (not our clients of course), be advised that the statute allows you to be barred from receiving any STAR exemptions for up to five years, make you pay back tax savings of up to three years with penalties and interest, fine you up to $5,000.  You could also face criminal prosecution.

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