New York City’s “pied-à-terre tax” implementation has once again stirred controversy. The Manhattan city government has acknowledged in its latest court documents that out of the approximately 17,000 property owners who received notifications from the Department of Finance (DOF), at least 1,210 properties have been verified as primary residences and are exempt from paying this additional tax. The city government has also extended the deadline for exemption applications for the second time, from September 18 to October 6.
According to court documents submitted by the city government on Tuesday, following the implementation of the new tax, notifications were sent to around 17,000 properties that potentially meet the tax criteria, requiring owners to submit proof of primary residence or other exemption qualifications. In addition to the 1,210 properties where errors were identified through state tax data by the city government, property owners who received notifications can also submit their own proof of primary residence or exemption applications. As of the latest document submission, the city government has received a total of 5,544 related applications, with 2,892 approvals and 2,652 still under review.
With the acquisition of state tax data for the year 2025, the Department of Finance plans to send out new notifications to approximately 10,800 properties by August 31, requiring owners who have not yet confirmed their eligibility to prove that the properties are their primary residences, or else they may be subject to additional taxes. Of these properties, around 6,400 are held by corporate entities or trusts, and approximately 4,400 properties currently cannot be determined as primary residences through relevant tax data.
This marks the second time the city government has extended the exemption application deadline. Initially set for the end of August, the deadline was first extended to September 18 following backlash from property owners after the policy was introduced. Now, it has been further extended to October 6, providing relevant property owners with more time to submit documentation.
The pied-à-terre tax mainly targets high-value non-primary residences in New York City. The scope includes one to three-unit residential properties with a market value exceeding $5 million as assessed by the Department of Finance, as well as cooperative and condominium apartments valued at $1 million or more that meet certain conditions. The relevant state law was passed by the state legislature this spring and signed by Governor Hochu, coming into effect last month.
The city government’s implementation approach is currently facing legal challenges. Attorney Randy Mastro, representing the plaintiff property owners, criticized that the city government should have first verified eligibility using state tax data before sending out notifications, describing the latest documents as an acknowledgment of “significant errors” in the policy’s implementation. He argued that the city government is shifting the burden of proof onto property owners, requiring them to demonstrate that the properties in question are indeed their primary residences.
In response, the city government contends that requesting primary residence proof from owners is part of the legal design, and even if the process burdens property owners, it does not imply illegality. Court documents also show that all five plaintiff property owners involved in the lawsuit at the New York State Supreme Court in Staten Island have been granted exemptions.
The next oral argument in this lawsuit is scheduled for August 31.