Within the last few years, the New York State School Tax Relief (STAR) Program has undergone significant change. These changes can be easily confused and misinterpreted, so we'd like to clarify them for you here.
If you have not yet read through the Budget Glossary, we recommend taking a look before reading this information.
If you still have questions, please feel free to call the BKW business office at 872-0909, or contact your local assessor.
What is STAR?
STAR is the New York State School TAx Relief Program. It exempts a portion of a home’s full value from school property tax. All New Yorkers who own and live in their homes—no matter what type—are eligible for a STAR exemption on their primary residence.
STAR is a state program, which school districts have no control over. Homeowners must go through their local assessor's office to apply for the exemptions.
Each year, the Office of Real Property Services [ORPS], a division of the state Dept. of Taxation and Finance, sets the exemption amounts for each municipality. You can find these amounts here. [Note: Amounts are typically updated each April.]
Summary of changes to STAR
BASIC and ENHANCED STAR exemptions are
STILL IN PLACE.
Basic STAR is available to all property owners, and Enhanced STAR is
available to seniors ages 65 and older. These programs exempt portions
of your property's assessed value from school taxes. Generally, once you
apply for either exemption, you do not have to apply again unless your
primary residence changes. If you are unsure about whether you have to
apply or not this year, contact your local assessor.
The Middle Class STAR Rebate Program
has been ELIMINATED.
This program provided a rebate check to homeowners who receive the STAR
exemption on their property tax bill.
The "floor" for the STAR exemption has
changed.
Every year, STAR exemptions for every municipality change based on the
municipalities' equalization rates (which are affected by the housing
market). The state mandates that STAR exemptions for every municipality
must be at least a certain percentage of what they were the previous
year. Up until 2007, the STAR exemption had to be at least 95 percent of
what it was the prior year in any given municipality. In 2008, that
"floor" of 95 percent was reduced to 90 percent in response to changes
in the housing market. This year, it's down to 82
percent. This can affect the amount of property tax you pay.
About Basic and Enhanced STAR
Basic STAR is available to all
homeowners regardless of age or income.
Typically, Basic STAR exempts $30,000 of your property's total assessed
value from school taxes. HOWEVER, your Basic STAR amount can vary by
municipality. For a complete list of STAR exemptions by municipality, go
to this site offered by the New York State Office of Real Property
Services. Currently, the 2008-2009 figures are posted but this is
expected to be updated soon.
Enhanced STAR is available to all
homeowners ages 65 and up.
Enhanced STAR will exempt the first $60,100 of your property's assessed
value from school taxes. An income standard must be met to qualify for
Enhanced STAR. For more information, please contact your local assessor
or the state Office of Real Property Services.
How the STAR Exemption "floor" can affect your bill
Just two years ago, the STAR exemption on your property value had to be at least 95 percent of what it was the previous year. In other words, your STAR exemption amount could not decrease by more than 5 percent regardless of market conditions. Starting in 2009, the STAR exemption has to be at least 89 percent of what it was in 2008. This change could possibly mean the amount of your home value that is exempt from school taxes will be reduced, which can in turn increase your tax bill. However, before blaming any increase in the tax bill on this state regulation, please consider the following:
Pay attention to the "at least" part of this state regulation. The 89 percent figure is a "floor," meaning your STAR exemption amount cannot be reduced by more than 11 percent. It is possible your exemption amount will not change at all, or even increase.
The "floor" amount for your municipality will be based on its equalization rate. This rate ebbs and flows with the market, and is affected by whether or not your municipality assesses properties on a regular basis.
Resources
STAR Exemptions by Municipality
NYS Office of Real Property Services website
Dept. of Taxation & Finance STAR Information
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