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Volume 12 - Opinions of Counsel SBRPS No. 8

Opinions of Counsel index

Volunteer firefighters and ambulance workers exemption (Westchester County) (eligibility for State income tax credit); Volunteer firefighters and ambulance workers income tax credit (eligibility for real property tax exemption) - Real Property Tax Law § 466-d; Tax Law § 606 (e-1):

For purposes of 2007 income tax payments, volunteers firefighters and ambulance workers, who timely filed in 2006 for their real property tax exemptions, some or all of the benefit of which they received on 2007 (or 2007-08) real property taxes, could still qualify for the 2007 income tax credit. Likewise, if they notified assessors by December 31, 2007 of their intention to not reapply by the next taxable status date, they could qualify for the 2007 income tax credit. If volunteers receiving the real property tax exemption are to also receive the income tax credit for purposes of 2008 or later income tax years, further statutory amendment will be necessary.

We have received an inquiry concerning the volunteer firefighters and ambulance workers’ (hereafter volunteers) exemption for Westchester County (Real Property Tax Law, § 466-d, as added by L.2003, c. 142) as it relates to the State income tax credit for volunteers (Tax Law, § 606(e-1)). The volunteers were informed that, if by December 31, 2007, they notified their assessors that they no longer wished to receive the real property tax exemption, they could qualify for the income tax credit.

We are asked if this was to ensure that the assessor did not grant the exemption on the 2008 assessment roll or whether there was authority for the assessor to remove the exemption from the 2007 roll. Secondly, given the assessment calendar followed in Westchester County towns, where prior year assessment rolls are used (e.g., the September 2007 final roll was used in April 2008 for the town tax levy and in September 2008 for the 2008-09 school levy), did this mean that the volunteers could not receive the income tax credit on 2007 income taxes due in April 2008?

Since 1999 (c. 617), the Legislature has been enacting local option, partial real property tax exemptions, generally on a county-by-county basis. As of this date, exemptions have been authorized in 28 counties, Westchester County’s authorization, as noted above, being enacted in 2003. While each statute authorizes a 10 percent assessed value exemption, in all but four counties (i.e., Westchester, Nassau, Suffolk, and Montgomery), the exemption is capped at the lesser of $3,000 or $3,000 multiplied by the State equalization rate. In the counties subject to the dollar cap, even assuming adoption by the county, city/town, village (and, if authorized) school district, the exemption provides a relatively modest benefit. The benefit obviously can be much greater in Westchester and the other three counties not subject to the dollar cap, provided their municipalities generally choose to authorize the exemption.

Seemingly to address the dissatisfaction of volunteers in counties (1) where no real property tax exemption has been authorized, (2) where the dollar cap applies, or (3) there has been limited local adoption of the property tax exemption, in 2006 (c. 62, Pt. U, § 1) the Legislature enacted a State income tax credit of $200 applicable in income tax years on and after January 1, 2007. Presumably to avoid what some might characterize as “double-dipping,” section 606(e-1)(2) provided: “If a taxpayer receives a real property tax exemption relating to such service under title two of article four of the real property tax law, such taxpayer shall not be eligible for this credit.” However, by the time the Tax Law provision was enacted, in many jurisdictions, applicants had already filed to receive their volunteer exemptions on 2006 assessment rolls (to be used, at least in part, for the levy of 2007 taxes). Without amendment, these volunteers would have been ineligible for the income tax credit on 2007 taxes despite the fact that, for many, that tax credit far exceeded their real property tax benefit.

To rectify this, chapter 532 of the Laws of 2007 amended section 606(e-1)(2) adding the following after “credit”:

;provided, however (A) if the taxpayer receives such real property tax exemption in the (2007) taxable year as a result of making application therefor in a prior year or (B) if the taxpayer notifies his or her assessor in writing by (December 31, 2007) of the taxpayer's intent to discontinue such real property tax exemption by not reapplying for such real property tax exemption by the next taxable status date, such taxpayer shall be eligible for this credit for the (2007) taxable year

In answer to the questions presented, if assessors were to grant the exemptions on 2008 assessment rolls, timely applications were required on or before the locally applicable taxable status date (e.g., June 1, 2008 in Westchester Co. towns). [Ed. note: Section 283.141 of the Westchester County Administrative Code has been amended to authorize towns in such county to use a May 1 or June 1 taxable status date.] We do not read chapter 532 as authorizing assessors to change any assessment roll entries to remove previously granted exemptions. For purposes of 2007 income tax payments, volunteers, who timely filed in 2006 for their exemptions, some or all of the benefit of which they received on 2007 (or 2007-08) real property taxes, could still qualify for the 2007 income tax credit. Likewise, if they notified assessors by December 31, 2007 of their intention to not reapply by next taxable status date, they could qualify for the 2007 income tax credit. For purposes of 2008 or later income tax years, however, if volunteers receiving a real property tax exemption are to also receive the income tax credit, further statutory amendment will be necessary. {1}

December 24, 2007
Revised September 9, 2008


{1}  We note that a bill (S.6869) to permit volunteers to receive both the income tax credit and the real property tax exemption where it is available, passed the Legislature in 2008, but was vetoed by the Governor (2008 Veto Memorandum #120).

Updated: