STAR Program update for tax professionals
Below are two updates regarding the STAR program. We want you to be aware of these changes.
As you know, property owners can receive STAR benefits in two different ways:
• as a reduction on their school tax bill (the STAR exemption)
• as a check from New York State (the STAR credit)
Recent changes in the law may you.
STAR exemption recipients with incomes between $250,000 and $500,000
Beginning this year, your clients with incomes between $250,000 and $500,000 will no longer be eligible for the STAR exemption. However, they may be eligible for the STAR credit.
The Basic STAR exemption income limit is now $250,000. However, the income limit for the STAR credit continues to be $500,000.
The NYS Tax Department are automatically registering affected property owners for the STAR credit using information they previously provided to us when registering for the STAR exemption or a STAR-related benefit.
Most will not need to take any action to switch to the STAR credit; however, some will receive letters asking them to provide them with additional information.
Here are samples of the two letters you may receive:
STAR exemption recipients with incomes of $250,000 or less
Property owners who are receiving the STAR exemption and whose income is $250,000 or less can choose to register for the STAR credit. Due to recent law changes, they may receive a greater benefit. The STAR exemption benefit can no longer increase, but the STAR credit benefit can continue to grow by up to 2% annually.To simplify the process for switching to the STAR credit, the NYS Tax Department added new options to the beginning of the STAR credit registration online application. Homeowners are now guided to choose from three options:
• Update Registration
• Make the Switch
• Register for STAR
If the property owner selects Make the Switch, the NYS Tax Department will notify their assessor directly. The property owner will no longer need to contact their assessor or submit additional forms to withdraw their exemption.
Contact your DDK tax advisor for any further questions!
