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Volume 3 - Opinions of Counsel SBEA No. 89

Opinions of Counsel index

Veterans’ exemption (ownership) (scope of exemption) - Real Property Tax Law, § 458:

If a person in the eligible class, as defined in section 458 (veterans’ exemption), owns less than 100 percent of the parcel on which he seeks an exemption, then the eligible funds invested in the property by such person should be deducted from an equivalent percentage of the assessed value of the property in computing the exemption.

We have received an inquiry requesting our opinion concerning the amount of exemption from real property taxation which may be granted to the three owners of a parcel of real property who are each in the eligible class as defined by section 458 of the Real Property Tax Law, the veterans’ exemption.

Subdivision 1 of section 458 provides for an exemption to the extent that eligible funds are used to purchase real property owned by a member of the exempt class. No such exemption on account of eligible funds shall be allowed in excess of $5,000. In this inquiry, a veteran and two unremarried widows of veterans have purchased a piece of property. The veteran has more than $5,000 in eligible funds while one widow has $874.50 and the other $704.00 in such funds.

The deed by which these three people took title to the real property on which they are seeking an exemption is silent as to their legal interest therein as to one another. However, the law presumes that a disposition of property to two or more unmarried persons creates in them a tenancy in common, unless expressly declared to be a joint tenancy (Estates, Powers and Trusts Law, § 6-2.2(a)). Likewise they are presumed to have equal shares in the property.

Real Property Tax Law, section 458, grants the exemption on property owned by a member of the exempt class. If he is considered to be the owner of 100 percent of the property, then the eligible funds invested (up to the $5,000 limit) should be deducted from 100 percent of the assessed value of the property. If, however, as here, he is considered to be the owner of something less than 100 percent of the property, then the eligible funds invested should be deducted from an equivalent percentage of the assessed value of the property. That is, the amount of his exemption cannot exceed the amount of his percentage of the assessment.

In the case, where the assessed value of the property is $6,000, each of the co-owners may apply his or her exemption up to a limit of $2,000 (i.e., one-third of assessed value). Thus, while it is possible for the total veterans’ exemption on a parcel to exceed $5,000, where more than one veteran has an interest in it (see, 1 Op.Counsel SBEA No. 54), that result is not reached given the facts herein.

(The above inquiry came from a locality which applies eligible funds directly against assessed value in allowing exemptions to veterans.)

May 8, 1974

Updated: