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NYC Department of Housing Preservation & Development
Developers

Tax Incentives
J-51

 

J-51

As-of-right tax exemption and abatement for residential rehabilitation or conversion to MULTIPLE DWELLINGS

ELIGIBLE PROJECTS

For projects that complete construction before December 31, 2011:

  1. Governmentally-assisted moderate and gut rehabilitation of MULTIPLE DWELLINGS;
  2. Privately-financed moderate and gut rehabilitation of MULTIPLE DWELLINGS;
  3. Privately-financed and governmentally-assisted major capital improvements to MULTIPLE DWELLINGS; and 
  4. Conversions of lofts and other non-residential buildings into MULTIPLE DWELLINGS.

For projects that complete construction on or after December 31, 2011:

  1. Governmentally-assisted moderate and gut rehabilitation of MULTIPLE DWELLINGS;
  2. Privately-financed moderate and gut rehabilitation of MULTIPLE DWELLINGS;
  3. Privately-financed and governmentally-assisted major capital improvements to MULTIPLE DWELLINGS;
  4. Cooperative/condominium projects with an average assessed value of less than $30,000 per dwelling unit or less;
  5. Cooperative/condominium projects with an average assessed value of $30,000 or more per dwelling unit only if carried out with substantial governmental assistance (defined as federal, state or city grant/loan/subsidy or a written agreement between HPD and the HDFC owner/applicant).  This limitation is not applicable to Parkchester, Article V Redevelopment Company,  or Mitchell Lama projects; and
  6. Conversions of non-residential to residential property only if carried out with substantial governmental assistance (defined as federal, state or city grant/loan/subsidy or a written agreement between HPD and the HDFC owner/applicant).
TIME REQUIREMENTS

For projects that complete construction before December 31, 2011:

  1. must complete work within 36 months (projects with substantial government assistance may have up to 60 months)
  2. must file application within 48 months of commencement
  3. must complete application within 24 months

For projects that complete construction on or after December 31, 2011:

  1. must complete work within 30 months (projects with substantial government assistance may have up to 60 months)
  2. must file application within 36 months of commencement
  3. must complete application within 12 months
  4. may be subject to inspection penalty fee if work is incomplete at time of inspection

BENEFITS GRANTED

  1. 34-year (30-years full + 4-years phase out) or 14-year (10-years full + 4-years phase out) exemption from the increase in real estate taxes resulting from the work. Affordable housing projects generally get the 34-year exemption while other projects get the 14-year exemption;

  2. Abatement of existing real estate taxes by up to 8 1/3% or 12 1/2% of the cost of the work each year for up to 20 years. Affordable housing projects generally receive the 6% abatement while other projectsget the 4% abatement.

Privately-financed projects in Manhattan south of 110th Street and co-ops and condominiums generally receive some limited benefits.

All rental units become subject to rent stabilization or rent control for the duration of the benefits. In rental buildings, the landlord must also waive 50% of the rent increase which would otherwise be allowed under rent stabilization as a result of the work.

PROCEDURAL REQUIREMENTS

The developer applies to Tax Incentive Programs (TIP) of HPD. Projects receiving governmental assistance may apply for temporary benefits during construction/rehabilitation. All other projects may apply after completion of work, but not more than four years after commencement of construction. Applications must be completed within two years of the filing date. TIP issues Certificate of Eligibility. The Department of Finance implements the benefits.

NOTICES

Notice of Adoption of Rules Governing Tax Exemption Under §489 of The Real Property Tax Law of The State of New York

HOW TO APPLY

Obtain additional information and request an application by calling (212) 863-5517. Completed applications are accepted from February 1-March 15, from May 1-June 15, from August 1-September 15, and from November 1-December 15.

Submit completed application to: J-51 Program, Tax Incentive Programs, Room 8-C10, HPD, 100 Gold Street, New York, NY 10038. There is a $500 application fee.

You may also download the following (Note: To download these documents, you will need the latest copy of the Adobe Acrobat Reader.)

Summary of office hours:
Walk-in hours: Tuesdays and Thursdays 9:00am-12:00pm and 1:00pm-3:00pm
Appointments: Mondays and Wednesdays 9:00am-12:00pm and 1:00pm-3:00pm
No walk-ins or appointments on Fridays. Customers may still call customer service at (212) 863-5517

 

Please note: The above tax incentive program is for developers and future or current property owners. If you are looking for an affordable apartment, please visit our Affordable Housing Hotline. Additionally, HPD's partners are required to advertise available affordable apartments in daily and local newspapers.





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