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Volume 5 - Opinions of Counsel SBEA No. 60

Opinions of Counsel index

School districts and BOCES exemption (life estate) - Real Property Tax Law, § 408:

Property conveyed to a school district with a life estate reserved to an individual is not exempt pursuant to section 408 of the Real Property Tax Law since the life tenant is considered to be the owner of the real property for purposes of taxation.

Our opinion has been requested as to the taxable status of a parcel transferred to a school district. A legal life estate was reserved by the former owner of the property when the parcel was transferred. Apparently, the property was not granted an exemption on the ground that it was not being used for educational purposes. The attorney for the school district has indicated that real property, title to which is in a school district, is exempt pursuant to section 408 of the Real Property Tax Law whether or not it is used for educational purposes (3 Op.Counsel SBEA No. 23; 4 Op.Counsel SBEA No. 31). Our opinion is requested as to whether or not an exemption should be given in this case.

As the school district’s attorney has correctly noted, the fact that the parcel is not being used for school purposes is not controlling. Section 408 contains no use requirement as is present in several other exemption statutes (see, e.g., Real Property Tax Law, §§ 406, 421). However, it is our opinion that the property is nevertheless taxable since the school district is not the fee simple owner of the parcel, but enjoys only a remainder interest in said property, a life estate having been reserved to the prior owner. We have previously indicated that:

A life tenant in possession should be considered the owner of the real property for purposes of taxation and such property is properly assessable in the name of the life tenant (3 Op.Counsel SBEA No. 45).

Likewise, we have stated that:

Property conveyed to a church with a life estate reserved to an individual does not meet the requirements of section 421 [of the Real Property Tax Law] and is subject to taxation since a life tenant in possession is considered the owner of the real property for purposes of real property taxation (3 Op.Counsel SBEA No. 44).

While this lattermost opinion is concerned with a different section of the Real Property Tax Law, our conclusion is the same as to section 408. Thus, so long as the life tenant’s interest in the parcel remains, the property should be considered to be fully taxable unless such life tenant is entitled to some other exemption from real property taxes (e.g., Real Property Tax Law, § 458).

February 23, 1976

Updated: