Correction of real property transfer reports procedure
Correction claiming significant change
Definition: Significant change means that a physical change of 10% or more of the total market value of a property has occurred to the property between the taxable status date for the preceding final assessment roll and the date of the sale (e.g., new construction or demolition) AND the assessment must change on the next appropriate roll and be reported as a physical change.
Corrections filed as an application for a revised Residential Assessment Ratio (RAR)
The burden of proof shall be on the applicant to demonstrate the truth of the statements in the application through the accompanying documentation. All corrections should be documented as outlined in 20 NYCRR 8186-15.2 (d)(6)ix of the rules regarding administrative review of tentative State equalization rates, tentative class ratios or tentative class equalization rates.
The following criteria are used to exclude a sale for both appraisal and ratio purposes. Meeting any of the following ten (10) criteria for exclusion as a useable sale immediately eliminates a sale from further consideration for both appraisal and ratio purposes.
Appraisal use criteria:
- Sale between relatives or former relatives,
- sale between related companies or partners in business,
- one of the buyers is also a seller,
- buyer or seller is a government agency or lending institution,
- deed type not warranty or bargain and sale,
- fractional or less than fee interest conveyed,
- Life Estate,
- Seller separates and retains mineral or other rights at the time of sale.
- sale of business included in sale price,
- full sale price minus personal property equals $10 or less,
- more than 1 year (365 days) between sale contract date and date of sale/transfer,
- other unusual factors affecting the sale price.
Examples of the unusual factors that are accepted without further documentation:
- Estate sale and Trust sales, (can be used if notified by assessor and the sale meets the other conditions of market value. A conveyance under powers granted in a will or trust may not represent an arm's length transaction, particularly if the sale takes place soon after the will has been filed and admitted to probate in order to satisfy the decedent's debts or the wishes of an heir.)
- charity, religious, education, subsidized housing,
- forced sale: Foreclosure or in lieu of, auction, referee, tax sale, bankruptcy, divorce, judicial order,
- substantial personal property: Good will business value 10% or more of full,
- sales price: If amount of personal property not specified,
- sale price is suspect,
- sale of common area for condo or association,
- assumed mortgage not reported or cash consideration not reported,
- prior relations between buyer and seller, example: Neighbors, friends
tenant, landlord, trade of property.
Examples of unusual factors that require further documentation
- Uninformed buyer or seller
Price above or below market: Need some rationale that may be supported by, but not limited to, such evidence as price/sq.ft. comparison.
In addition, you may wish to override the assumption that sales are Not Arm's length. If an assessor or ORPTS staff feels a sale in one of the ten criteria for exclusion listed above should be used, he or she must demonstrate that the sale reflects market value.
For ratio use, one needs only selling price information and the appropriate assessment data but not corresponding inventory data.
The following criteria are used to exclude a sale for Ratio purposes, but the sale is potentially useable for appraisal purposes.
- Significant physical change occurred between taxable status date and sale date,
- sale is part of a parcel,
- sale includes multiple parcels, (sale of several parcels within one municipality or property is in more than one municipality.)
- sale is a condominium, (condo sales may be used for appraisal purposes and as observations in full value measurement in approved assessing units using the homestead provisions of Article 19. However, all condos are excluded from RAR calculations.)
- full sale price minus personal property is less than $10,001,
- total assessed value is zero,
- the primary use of the parcel will change after the sale,
- parcel is not residential. (Parcel is not in Property Class 200 Series Excluded for RAR purposes only. All condominium sales are excluded from the RAR computation even in municipalities affected by the homestead provisions of Article 19.)
This procedure is established pursuant to Articles 12-A and 12-B of the Real Property Tax Law.
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