STAR Program Explained: Exemption Survival After Owner's Passing

This week we wanted to address a question that has come up from time to time - Does a STAR exemption remain on the property if an approved STAR applicant dies after the Taxable Status Date? (NOTE: for STAR Abatement purposes the Taxable Status Date is March 1 of each calendar year).

Answer: Yes, but only for the assessment roll based on that Taxable Status Date. While other exemptions (such as those awarded based on Veterans or Senior Citizen status) are subject to removal when property is transferred to a non-exempt owner after Taxable Status Date (see, RPTL §520 codes.findlaw.com/ny/real-property-tax-law/rpt-sect-520/) which transfer often results in the imposition of a future Restored Tax assessment on the property’s tax account, this does not apply to STAR program (see RPTL §520(5)). Any new owner of that property during the entirety of the fiscal year would receive the benefit of such exemption regardless of whether it was for the Basic or the Enhanced STAR exemption. Below is a link to the NYS Department of Taxation and Finance website which includes valuable information regarding the STAR program.

https://www.tax.ny.gov/pit/property/star/assessorguide.htm

In short, this means that Sellers and Purchasers do not have to be concerned about possible Restored Taxes for STAR abatements (Enhanced or Basic) from the date of the original STAR applicant’s death to the start of the next fiscal (tax) year (i.e.. July 1 of the following year) where the STAR applicant dies after the Taxable Status Date. As an example, if a homeowner qualified for an Enhanced STAR Abatement on March 1, 2020, to be applied in the 2020/2021 fiscal tax year and thereafter died on August 10, 2020, the Enhanced STAR Abatement would remain available to any successor owner through and including June 30, 2021.

There are also additional guidelines and FAQs in the Assessor Guide on the NYS Department of Taxation and Finance website including, but not limited to, information about the continued availability of an Enhanced STAR Exemption if the spouse of the deceased STAR Applicant is at least 62 years of age. A surviving spouse may retain the Enhanced STAR exemption provided he/she was a co-owner or becomes the owner of the property due to the owner spouse's death and is at least 62 years of age as of December 31^st in the calendar year when the spouse died. We recommend that you utilize the above link to the NYS Department of Taxation and Finance website as a resource tool whenever you encounter a specific issue regarding the STAR program.