Skip to main content

Volume 11 - Opinions of Counsel SBRPS No. 113

Opinions of Counsel index

Veterans exemption (generally) (computation - transfer of pro rata exemption) - Real Property Tax Law, § 458:

Where they are still in effect locally, the former pro rata provisions of the eligible funds veterans exemption provide that such percentage of exemption may be transferred within the same assessing unit, but that the exemption is limited to the amount received on the former property.

Our opinion has been requested concerning the eligible funds veterans exemption (Real Property Tax Law, § 458). The facts are that a property owner is selling her home within a particular city upon which she receives an exemption of $75,840 (apparently representing 96% of her assessed value) and using the proceeds of sale to purchase a smaller home within the same city. The question is how much of an exemption should be granted to the new home.

The city in question adopted and still grants the former pro rata exemption provisions of the statute (former RPTL, § 458(5) as added by L.1979, c.134 and repealed by L.1994, c.410). {1}  This issue is addressed in the provisions of former section 458(5)(b) which provided:

Where property which is owned by a veteran and receiving an exemption pursuant to this subdivision is sold and other real property is acquired to replace the formerly-owned property, the exempt amount granted on the formerly owned property pursuant to this subdivision and as expressed in a percentage shall be granted on the property acquired to replace the formerly owned property, provided that the newly acquired property is in the same assessing unit and provided, further, that the exemption granted on the newly acquired property shall not exceed the exemption on the formerly owned property, as expressed in a dollar amount.

In other words, the property owner is entitled to the same percentage of exemption on her new home as she received on her old home not to exceed the dollar value of the old home. If the new home has a value equal to or less than $75,840, she will continue to receive her 96 percent exemption; if the value of the new home is more, her exemption will be limited to $75,840.

October 19, 2007

{1}  Bill section 1 of chapter 410 of the Laws of 1994 repealed the pro rata option and substituted the change in level provisions of current section 458(5) (discussed in 11 Op.Counsel SBRPS No. 49). However, bill section 2 of chapter 410 provides: “Notwithstanding the repeal of subdivision 5 of section 458 of the real property tax law by section one of this act, local laws adopted pursuant thereto and in effect on the effective date of this act [i.e., July 20, 1994] shall remain in full force and effect unless and until repealed by subsequent local laws.” The city in question has not repealed its local law authorizing pro rata exemptions.