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FAQ About Property Taxes in Sullivan County

Property taxes in Sullivan County can be very confusing to new buyers. If you’re from New York City, they can seem high, and there seems to be wide variations between townships, and even between similar houses within townships.

I’ve tried to answer the most common questions I get about property taxes here. Please keep in mind that the following information is not “definitive”. It’s based on my experience with property taxes and assessments here for more than a decade. For example, while clients of mine to my knowledge have not had ‘spot reassessments’ of houses after purchase, there are scenarios where that could happen to you.

The property tax system, particularly the assessment process, in New York State is very complex, even Byzantine. Some of the most seasoned Realtors don’t even really understand how it works. While the theory and law regarding assessments is standard throughout New York state (with the exception of New York City, which has a more complex system), the reality of how it plays out in practice varies from jurisdiction to jurisdiction. So YMMV (your mileage may vary)

Please note that I don’t handle assessment grievance filings, although people ask about hiring me to do it all the time. I sit on the Board of Assessment Review for my town (Delaware), so am not able to attend grievance hearings in other towns.

What are property tax rates in Sullivan County?

Property taxes in Sullivan County, like the rest of New York, consist of two major components, the “property” tax itself (which includes county and township taxes, plus levies for the volunteer fire department, ambulance service, libraries, etc.) and the school tax for the school district in which the property is located. Added together, the tax rate varies from a low of about $25.00 per thousand of property value to a high of about $65.00 per thousand of property value. The Town of Neversink is an exception, with typically lower rates due to transfer payments from New York City due to the presence of NYC water reservoirs in the town. Likewise, a tax rate of 6.5% is also an outlier, largely in the Town of Liberty. Overall, the rate hovers around 3 to 3.25% of property or market value in most areas of Sullivan County.

Why is there a difference between the assessed value and the market value of a property?

In most towns, the assessed value of a property is often much less than the actual property or market value, The reason is that many towns assess property at a percentage of full market value. In the Town of Neversink, the assessed value in 2014 was just 3.8% of market value, and in the Town of Forestburgh, just 8.83%, comapred to 100% in Lumberland and 94% in Highland. But that doesn’t mean that property taxes on a similar property in Forestburgh are less than 10% of those in Highland. It all comes out in the wash when the ‘equalization rate’, which is calculated by the state, is applied. When you look at tax records, it’s more important to look at the Full Market Value number (which is the assessed value divided by the equalization rate) rather than the Assessed Value.

If you think this is bizarre and confusing, it is. But there is an underlying logic. You can find the equalization rates for the towns and villages in Sullivan County here.

How is the assessed value determined?

New York is an “equality” state, in terms of property assessment. What that means is that, in theory at least, all similar properties in a jurisdiction (township or village) should be assessed equally. So all 3 bedroom, 2 bath 1,600 square foot ranch houses on 5 acres with a finished basement and 2 car garage built in the 1960’s should have roughly the same assessed value. There are also adjustments for factors that affect value, like lake frontage or a pond.

This equality mandate is the basis of most assessment grievances, and also the reason why houses are typically not ‘spot reassessed’ on sale, because if you pay $250,000 for a house with an adjusted FMV (full market value) of $175,000, the assessor in theory would need to increase all of the similar houses with an FMV of $175,000 to an FMV of $250,000. Legally, he or she can do that, but seldom do.

Over time, the assessed values in a jurisdiction get of whack with market values. Then a town may undertake a townwide reassessment, to bring assessed values back in line with market values.

What contributes to a higher assessed value?

The biggest factor is the house itself, namely square footage and number of bedrooms and baths (heated, above grade square feet). Bigger houses with more bedrooms and baths are assessed higher than smaller houses with fewer bedrooms and baths. Then comes secondary building factors, like porches, decks, garages and finished basements. Age and condition of house comes into play, along with acreage and setting. Lake frontage adds a huge amount to the land portion of the valuation. Interior “fit and finish” often isn’t a major factor. But if you undertake major renovations, even without increasing the footprint of the house, you’ve likely increased the market value and the assessor may have cause to increase your assessment above other similar sized houses.

If I buy a house for more than the assessor's Fair Market Value, will the assessment go up?

First, you need to translate the assessed value into the “market value” that the assessor has placed on the property. (See above.) If you find out you’ve paid more than the assessor’s estimate of “market value” for the house, your taxes won’t necessarily go up upon sale. Tax assessors are not supposed to do “spot” reassessments on a single property — with one major exception. If it is apparent that there has been a material change to the property (e.g. a basement was finished into living space, or a garage or swimming pool was added) that is not reflected in the assessors’ tax record, they can reassess the property to reflect those changes which increase value. Generally, however, the assessment will not substantially change when you purchase a property. For example, if you pay $250,000 for a ranch house in Bethel with an assessor’s market valuation of $150,000, the house must still be equitably compared to other similar houses — so if the Bethel tax assessor raises your assessment to $250,000 (which is the fair market value of the house, since you paid that amount), they would technically be required to increase the assessment on other similar houses to that amount.

If I pay less than the assessor's FMV for a house, will the assessed value go down?

Not necessarily. An assessor looks at the total market basket of sales over a 12 month period when looking at market value. Other similar houses may have sold for more, and the assessor blends them together to arrive at market value. Also, if you bought a ‘distressed’ property — foreclosure, short sale or p[ossible an estate sale — your purchase may not be a good indicator of market value.

However, if your purchase price is much less than the assessor’s FMV, that’s a strong data point. Go talk with the assessor and see if he/she will make an adjustment to your property assessment. If not, you can also pursue an assessment grievance.

Why are property taxes in Sullivan County so 'high'?

There are a number of factors that contribute to relatively high residential property taxes here — low density, relatively low property values and a small commercial tax base. The biggest contributor is low density; what makes Sullivan County so attractive for a second home getaway is also what pushes up property taxes. In New York City, there can be thousands of tax paying housing ‘units’ in a square mile. Here, there may be only a few dozen tax paying housing ‘units’ in a square mile. There are still roads to maintain and plow and services to provide, but the cost of those services is spread out over a much smaller tax base.

Property values in Sullivan County are, overall, much lower than other downstate areas, and that can make the property tax rate seem very high. In the Hudson Valley, for example, a 3BR, 2BA newer home on 5 acres might sell for $400,000 and have taxes of $8,000, or 2% of market value. A similar house here in Sullivan might sell for $250,000 and also have $8,000 in taxes. The taxes seem higher here, but they’re not really on a similar house basis, but they are on a percentage of value basis.

Sullivan County is primarily rural. We don’t have a large commercial base and few large corporate taxpayers. Those big office buildings, factories and warehouses close to the city bear a huge amount of the tax burden, reducing the tax burden on individual residential homeowners. Also, here in Sullivan County, a lot of our land is taxed at lower “agricultural” rates or is in the forestry protection program, with substantial tax abatements. When you’re driving through Sullivan County enjoying the beautiful and relatively unspoiled vistas, they comes at a cost — those pastoral farmlands and unspoiled woodlands are only economically viable because they’re taxed at lower rates.

Sullivan is also a relatively poor county. The poverty rate here among full time residents is 18.2%, compared to 12.5% in Orange and 13.6% in Ulster. That adds to the tax burden for social services. You may be surprised to learn that the poverty rate in Kings County (Brooklyn) is much higher at 24.2%, but the tax impact of that is much less apparent because of a broader and deeper tax base and the NYC city income tax.

Property taxes are high here because of all the religious non-profits, right?

This is a popular misconception, and one that is frequently used to “justify” negative perceptions of certain religious groups. In reality, Sullivan County has less property “off the tax rolls” due to non-profit ownership than most other New York counties. Yes, there are quite a few religious affiliated retreat centers here, including monasteries, nunneries and two Buddhist retreat centers. But it may come as a surprise that the largest non-profit land owner here is the Boy Scout Council of NY/NJ.

But non-profits aren’t the only property owners that get tax breaks that lower the overall tax base. Many people love the farms throughout Sullivan County, but most of those farms receive agricultural exemptions on the portion of those taxes. Owners with forest land can also receive a forestry exemption if they actively manage their forest land. So, taken all together, there is quite a bit of property that doesn’t pay full freight.

My property taxes are too high. What can I do?

High property taxes are not grounds for a grievance. The assessed value of your property, though, which is the basis for your property taxes, may be. There are two primary grounds for an assessment grievance — that the assessment on your property is unequal, meaning that it isn’t in line with other similar properties in the jurisdiction, or that your assessment is excessive, meaning that the assessor’s FMV (fair market value) is above the actual market value of your property. (There is a third ground, that an assessment is unlawful, but that’s a rarely used technical ground.)

There’s an established assessment grievance process in New York, handled at the town level. Each town has a Board of Assessment Review (BAR), which is independent of the assessor. In May every year (generally the 4th Tuesday), property owners can make their case for an assessment review to the BAR. You do not have to appear in person on grievance day. You can submit your grievance with supporting documentation prior to grievance day for review. I sit on the Board of Assessment Review for my town (Delaware), and it’s often helpful when the property owner appears in person so we can ask questions and get clarification. If you’ve never filed a grievance before, you may not get the paperwork quite right, and if you’re there in person the BAR may suggest a change in your paperwork that will enable them to respond more favorably. (Note, some BARs are more helpful than others in this respect.) The BAR can’t make your argument, but a frequent mistake is that property owners choose the wrong grounds category for their grievance, Here’s a link to the New York State website about the grievance procedure.

A common misconception is that you can only apply for an assessment reduction on grievance day. That’s not the case. You can make an appointment with the assessor for your town at any time throughout the year to discuss your assessment. In many cases the property owner and assessor can come to a mutually agreeable number, without having to go the formal grievance route. It’s worth a shot. Note, though, that even if you have a good case, the assessor doesn’t have to make the adjustment, and you may have to go the grievance route. Some assessors are more amenable on this score than others.

You can also hire a professional to handle the grievance for you. If you recently purchased the property, contact the attorney that handled the transaction for you. They may or may not do grievance work, but if not, they will likely be able to refer you to an attorney or appraiser that does. Also, you may want to contact the Realtor who worked with you. They may be able to help you with your grievance or refer you to someone who can.

I personally don’t handle grievance filings. However, I do assist clients who’ve bought a house through me to walk through the grievance process and prepare a filing (if it’s not in the Town of Delaware, where I serve on the BAR, which would create a conflict of interest.)

Where can I find property tax information?

Property tax information for Sullivan County (towns,school districts and villages) is available at  www.taxlookup.net with the exception of the Monticello School District that uses a different tax reporting system, infotaxonline.com. When checking taxes for a property on these systems that every property has every property has at least two tax bills (town/county and school), and properties located within a village may have a third village tax bill as well. So you need to pull ALL of the relevant tax bills to get the total tax picture.

You also need to check the “Levy Details” on the town/county portion of the tax bill to see if there is a “School relevy” included in the tax amount. If a property owner doesn’t pay their September school taxes before the end of the year, they are rolled into the county taxes for the January tax bill. That can result in a deceptively high town/county tax bill (and is one of the reasons that Zillow’s tax calculations can be way off base.) On school taxes, you want to check “Property details” to see if there is a STAR exemption on the school taxes. (The STAR exemption is only available to you if the property is your primary residence.) If there is an exemption, and you won’t qualify for that exemption, you need to use the taxes as listed under “Tax Before Star.”

If I rent in the city and own a home in Sullivan, can I qualify for the STAR exemption on the house?

This is a tricky question. The STAR exemption provides for a reduction in the school portion of property taxes for a home that is your primary residence. If you rent in the city and own up here, that doesn’t make the house here necessarily your primary residence. Other factors, like where you spend the majority of your time, where your car is registered and the address you use to file your taxes, come into play. If you’re thinking of shifting your primary residence from NYC to Sullivan to qualify for the STAR exemption, you need to discuss this with your tax attorney or advisor to see if you qualify to make Sullivan your primary residence.

There are also some gotchas that you may not think about. If you have a rent stabilized apartment in the city, and then declare another residence as your primary residence, it can be grounds to cancel your rent stabilization. Declaring Sullivan as your primary residence, even if you don’t register to vote here, can make you subject to jury duty here. If you move your car registration to Sullivan, and declare to your insurance company that the car is domiciled or garaged here, and then you have an accident, it can cause problems if they discover that your car actually spends most of its time in NYC.

Can I rely on the property taxes in a listing to be accurate?

Unfortunately, no. There are a lot of reasons why. The multiple listing systems don’t have standard criteria for listing property taxes. Some listing agents state property taxes with all exemptions backed out. Others show the actual taxes paid by the current owners, which may include STAR, veterans and agricultural exemptions which you, as a new owner, may not qualify for. Those taxes could be half of what you might pay.

Some listing agents just plain make mistakes. The taxes can actually be too high, if they failed to back out a school relevy from town or property taxes, or too low if they failed to include both town/county and school.

The taxes stated on a listing may also be two or three years out of date. If a listing has been on market for a while, the listing agent may not have updated the taxes since the listing first went in. So in 2015, it’s not uncommon to see taxes in a listing for the 2013 tax year.

But at least on listings, there’s a better chance that the taxes are correct or at least close to correct, because most listing agents do get the taxes right, and make the appropriate adjustments. That’s not the case with online sources like Zillow, where taxes are auto-pulled, with no consistent back out of relevys or exemptions.

Property tax resources

Property tax lookup, all towns and school districts except Monticello schools
www.taxlookup.net

Monticello schools tax lookup
www.infotaxonline.com

Sullivan County Office of Real Property Services Assessment Data Lookup

New York State Equalization Rates for Sullivan County

New York State Assessment Grievance Page