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Lev, Tax Advisor
Category: Tax
Satisfied Customers: 29961
Experience:  Taxes, Immigration, Labor Relations
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How are taxes determined Property income SRO

Customer Question

How are taxes determined for Real Property income for a SRO Restricted property in New York City, Kings County?
Property market value is $515,000. There's currently 18 rental rooms across four different floors. Only 8 rooms are occupied. All tenants could be relocated to two of the floors. Are taxes determined per occupied room, or per occupied floor, or per SRO classified room whether occupied or not?
Tax Block: 236
Tax Lot: 135
Brooklyn, NY
Submitted: 2 years ago.
Category: Tax
Expert:  Lev replied 2 years ago.
The amount of your property tax bill is based upon the costs of your state and local government. This includes the operating costs of your schools, city and county, and of taxing districts such as hospital, fire and sewer districts. The assessed value of your property is multiplied by the tax rate necessary in your levy area to produce your fair share of the total levied tax by these jurisdictions.You can look up your property's assessed value online, using the Property Information System. You may lookup using your real property tax account number here - How we assess value? valuing residential real estate, we look at both land and improvements (buildings, bulkheads, etc.). We begin by establishing land value, which state law requires us to value as if it is vacant. This value is determined by analyzing sales of comparable bare land. If there have been no recent sales, we use other recognized appraisal methods.Our next step is to study sales and market trends of improved (developed or built-on) properties in a selected area. This sales analysis is used to determine total market value based on size, year built, quality of construction and other characteristics. From this total value, we subtract the amount determined for the land. The balance is allocated to improvements.In addition to this Market Approach, residential property can also be valued using the Cost Approach, which sets the value based on what it would cost to reproduce or replace the property, minus its depreciated value.In addition to statistical analysis to determine value, all properties are physically inspected once in every six year cycle.Whenever we revalue your property, you will receive an Official Property Value Notice showing your old and new total values with separate values shown for land and improvements.
Customer: replied 2 years ago.
I'm not asking to determine the value. I already know the assessed value as stated in my original question. I understand that property tax is based on the tax rate in my area. However, SROs (Single Room Occupancy) buildings are a nuance in NY and have some different rules. I'm under the impression that there are discounts, alternate rates, or exemptions based on the property being a Class C5 (CONVERTED DWELLINGS OR ROOMING HOUSE). And I'm asking what those nuances are outside of the normal tax rate. And specifically wondering if those nuances have anything to do with number of rooms, floors, or occupancy percentage.I'm happy to provide more information about the specific property if that helps. Most of the information is available publicly here,
Expert:  Lev replied 2 years ago.
Let me verify...
Expert:  Lev replied 2 years ago.
Class C Buildings - Walk Up Apartments is a classification for residential property - and that includes Class C5.
That means - same assessment rules would be used as for other residential properties - and that woudl be based on the fair market value of the property - and not on the actual occupancy.
Residential property is assessed each year at its full market value, which is defined as the amount a buyer, willing but not obligated to buy, would pay to a seller willing but not obligated to sell. For residential parcels, fair market value is determined by analyzing recent sales of comparable properties in the same area.
The actual occupancy MAY affect the fair market value which generally is determined by appraising the property - so if you disagree with county determination - you may contact a private apprasal service - and verify if your assessed value is too high.
Sorry if you expected differently.
Let me know if you need any clarification this matter.