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Childcare Center Abatement
The Childcare Center benefit is a property tax abatement for property owners whose property construction, conversion, alteration, or improvement completed after April 1, 2022, resulted in the creation of a new childcare center or an increase in the maximum number of children allowed in an existing center as specified in the permit issued by the NYC Department of Health and Mental Hygiene (DOHMH).
Property owners who create a childcare center or increase the number of seats at an existing childcare center may be eligible for a property tax abatement covering up to $225,000 of construction costs.
NYC property tax classes one, two, and four properties are eligible for the abatement. These are generally single- and multi-family homes, co-ops, condos, rentals, commercial properties, and retail properties.
The abatement amount is equal to the reasonable construction expenses associated with the creation of new childcare seats in a childcare center, subject to a cap. The capped amount depends on whether the seats were created in a childcare desert, a designation that is determined by the New York State Office of Children and Families (OCFS).
DOHMH Preliminary Requirement(s)
The property owner applies for the abatement. The property owner must enter into an agreement with a childcare provider that is permitted by the NYC Department of Health and Mental Hygiene to operate in a childcare center.
Property owners must provide a childcare provider permit issued by DOHMH, along with determinations that have been certified by a licensed engineer, architect, certified public accountant, or other licensed professional in the field of business or design, regarding the size of the premises, costs incurred, and the reasonableness of costs incurred as comparable to construction costs for a childcare center in a similar eligible building. Eligible costs are costs of construction, conversion, or alteration that were necessary to create new childcare seats in a childcare center that is compliant with the NYC Health Code. Examples: additional means of egress, bathroom renovations, fire alarm system installation and upgrades, etc.
Please review the additional information on DOHMH requirements.
The amount of the abatement depends on whether the seats were created in a childcare desert, a designation that is determined by the New York State Office of Children and Families.
- Childcare Desert Determinations
A childcare desert is a census tract where there are three or more children under five years old for each available childcare slot, or where there are no available childcare slots. You can use this map to determine whether your center is in a childcare desert.
- If a property is in a childcare desert, owners may be eligible for a property tax abatement of up to $75 per square foot, or up to a total of $225,000.
- If property is not in a childcare desert, owners may be eligible for a property tax abatement of up to $35 per square foot, or up to a total of $100,000.
- If a property is in a childcare desert, owners may be eligible for a property tax abatement of up to $75 per square foot, or up to a total of $225,000.
- Abatement Period
The abatement is spread over five years, so the maximum abatement amount per year for properties in a childcare desert is up to $15 per square foot, or up to a total of $45,000, and the maximum amount per year for other properties is up to $7 per square foot, or up to a total of $20,000.
The City has budgeted a total of $25 million for this property tax abatement. Benefits may be reduced if approved abatements for eligible buildings exceed $25 million. You can determine if your location is within a childcare desert by using the Childcare Deserts Map.
Obtain the Childcare Center Abatement Application and follow the instructions for submission. Be sure to include all the supplemental material in your application packet.
Mail applications to:
NYC Department of Finance
Commercial Exemptions & Abatements
59 Maiden Lane, 22nd Floor
New York, NY 10038
A completed application, along with supporting documentation, must be submitted to the Department of Finance no later than March 15 prior to the tax year in which the abatement would take effect. (Tax years begin on July 1.) Applications received following the March 15 deadline are ineligible for an abatement starting the following July 1.