The Middle Class Star Exemption

The Middle Class STAR Rebate Program is a program that provides direct property tax relief to taxpayers by sending rebate checks to homeowners from the State of New York for a portion of their school taxes. The Middle Class STAR Rebate Program will provide an additional $6 billion to the STAR program over the next three years, with this year totaling $1.3 billion.

This Rebate program is provided to all homeowners currently enrolled in the STAR program with household incomes less than $250,000.  So you have to be in it to get it, which is a letter from New York state. Letters have already started appearing in the mail by the time you get this newsletter, with clear directions on how to apply for this new rebate. Do not throw them away thinking it is just another piece of junk mail.  The rebates are based on income levels, school district, and town and can be as much as $1,500.

When homeowners receive their letter from the state Department of Taxation and Finance, they may apply either online or the old-fashioned way: by completing a paper application that will be provided in the notification letter.

Good news for senior citizens 65 years and older who are enrolled in the Enhanced STAR Program: no application is necessary for the Middle Class STAR rebate. Those homeowners will automatically receive their rebate checks beginning in late September. The Middle Class STAR rebate for those receiving the basic STAR exemption is for those with incomes up to $250,000, based on 2005 income tax returns.

The rebate is in addition to the basic or enhanced STAR exemptions currently received. The Basic STAR Program started in 1997 as a way to help homeowners throughout the state counteract high property taxes. Based on a state formula, the exemption amount is subtracted from a homeowner’s assessment before taxes are applied. For example, if a house is assessed at $160,000 and the Basic STAR exemption is $25,000, the homeowner will pay school taxes on $135,000.

What you’ll need to apply

In order to apply for the Middle Class STAR, you will need the STAR code for your property. It is a six-character code included on your Tax Department letter. Simply go to www.tax.state.ny.us/star/2007 and click on “Apply Now.” You will be asked for the STAR code from your letter to proceed. If you do not have access to the Internet, complete the paper application included in the Tax Department letter, form DTF-179. It already has the STAR code pre-printed on it. You will also need the names and Social Security numbers of all resident property owners and their spouses, and you must verify that they filed a New York State income tax return for 2005. Remember, the deadline to apply for the Middle Class STAR Rebate is Nov. 30. For more information, call 1-877-678-2769 or log on to www.tax.state.ny.us/star/2007.

If you do not already receive the Basic STAR exemption, or if you are a senior citizen 65 or older and you do not receive the Enhanced STAR exemption, contact your local assessor or log on to the New York State Office of Real Property Services at www.orps.state.ny.us/star/ for an application.