{"id":516,"date":"2026-07-30T21:45:32","date_gmt":"2026-07-30T21:45:32","guid":{"rendered":"https:\/\/businessrelocationdigest.com\/?p=516"},"modified":"2026-07-30T21:45:32","modified_gmt":"2026-07-30T21:45:32","slug":"whats-a-pied-a-terre-tax-and-why-do-people-care","status":"publish","type":"post","link":"https:\/\/businessrelocationdigest.com\/?p=516","title":{"rendered":"What\u2019s a pied-\u00e0-terre tax and why do people care?"},"content":{"rendered":"
\n

Many homeowners have spent the last couple of days panicking that they\u2019ll end up being subject to the new pied-\u00e0-terre tax on high-value second homes in New York City.<\/p>\n

Read more \u2018Fuck this, we\u2019re getting better\u2019: Liz Krueger is on the mend<\/a><\/p>\n

Confusion has run rampant since the city Department of Finance last week posted a sprawling list of properties across the city, described as something that \u201cincludes, but is not limited to those properties that may be subject to the surcharge.\u201d In reality only a small fraction of the nearly one million properties listed had a chance of actually being subject to the tax, but its release drew a wave of backlash from New Yorkers who were caught off guard.\u00a0<\/p>\n

Around the same time, thousands of homeowners began receiving letters from DOF informing them that they have four weeks to prove the property is their primary residence, thus exempting them from the tax.\u00a0<\/p>\n

Confused? We broke it down.<\/p>\n

Where did this new tax come from?<\/strong><\/p>\n

Mamdani has been promising to tax the rich, and this is one way to do it that Gov. Kathy Hochul actually agreed with. The state Legislature passed the pied-\u00e0-terre (second home) tax on high-value properties earlier this year, with both Hochul and Mamdani celebrating its passage after false-starts in the past. Mamdani has been celebrating with a little more fervor \u2013\u00a0including the vertical video heard \u2019round Billionaires Row, in which he appeared outside a building where Citadel CEO Ken Griffin owns a penthouse apartment.\u00a0<\/p>\n

Who is subject to the tax?<\/strong><\/p>\n

Mamdani and Hochul have said that the tax would only apply to high-value properties that are not used as the primary residence of a homeowner, a full-time tenant or a family member. That includes people living both outside of the state and inside so long as it\u2019s a second property. One- two- and three-family homes worth more than $5 million would be subject to the tax, while co-ops and condos valued at more than $1 million could be subject. (More on how the value is assessed later.)<\/p>\n

Following confusion about the Mamdani administration\u2019s list of potentially eligible properties and the letters sent to homeowners this week, the mayor insisted at an unrelated press conference on Wednesday that nothing has changed in terms of who is subject to the tax.<\/p>\n

Officials initially estimated that the tax would generate $500 million a year and apply to 13,000 homes.\u00a0<\/p>\n

How much is the tax?<\/strong><\/p>\n

The tax rate is tied to property value, meaning the owner of a ritzy penthouse worth $80 million would be subject to a much larger surcharge than a one-bedroom worth $5 million.\u00a0<\/p>\n

According to a scale released by the Department of Finance, one-, two- and three-family homes valued between $5 million and $15 million would be subject to a 0.8% surcharge (or tax), homes between $15 million and $25 million would be be subject to a 1.05% surcharge and the most expensive properties \u2013 those with a value greater than $25 million\u00a0\u2013 would have a surcharge of 1.3%.<\/p>\n

The surcharge rate for condos and co-ops is higher, ranging between 4% and 6.5% depending on the property\u2019s estimated value. But this won\u2019t always be the case. Officials said condos and co-ops will be subject to the same surcharge rates as one-, two- and three-family homes once the city determines how to assess their potential sale value. \u201cAssessed values\u201d and \u201cmarket values\u201d determined by DOF are often much lower than what a property\u2019s sale value would be \u2013 especially for condos and co-ops.\u00a0\u00a0<\/p>\n

The pied-\u00e0-terre tax would be paid on top of whatever property taxes are already owed on the home.\u00a0<\/p>\n

Read more Mamdani orders agencies to find 2.5% savings \u2013 again<\/a><\/p>\n

Who is running this program?\u00a0<\/strong><\/p>\n

While the state law lays out the parameters of how the pied-\u00e0-terre tax should be administered, it\u2019s the city at the wheel. The city\u2019s Department of Finance is the main agency running the program. That\u2019s who the warning letters came from.\u00a0<\/p>\n

Did City Hall mess up by publishing that list of properties?\u00a0<\/strong><\/p>\n

With nearly a million properties included, the release of that list \u2013 which the city attributed to requirements laid out in state law \u2013 set off a wave of anxiety among homeowners. Most had no real reason to be concerned, though the city probably could have been clearer about what the list contained: information on most condo, co-op and one-, two- and three-family homes in the city. Once sorted to solely include properties with a value in which the surcharge could apply, only about 31,000 homes appeared. The info was also publicly available through city tax rolls.<\/p>\n

\u201cThe tax property roll that was posted last week is a reflection of all properties across New York City, not a reflection of those, specifically, that the pied-\u00e0-terre tax will be levied upon,\u201d Mamdani said Wednesday.<\/p>\n

The mayor and DOF Commissioner Richard Lee clarified that only people who received a letter could end up being subject to the tax. Those who didn\u2019t need not worry.\u00a0<\/p>\n

What\u2019s the deal with those letters?<\/strong><\/p>\n

About 17,000 homeowners recently received the letters from DOF notifying them that their property could be subject to the new surcharge if they are unable to prove that it is their primary residence, according to an agency spokesperson. Like the list, this set off anxiety amongst the property owners who received them, some of whom argued they shouldn\u2019t be subject to the tax.\u00a0<\/p>\n

Both Mamdani and Lee defended the outreach, arguing that it was important to inform people who could be impacted about the tax \u2013 and to give them adequate time to appeal. They also acknowledged that letters were sent based on information the city had on hand, which could be dated.\u00a0<\/p>\n

\u201cAs required by the law, the Department of Finance sent informational resources to homeowners to ensure they understood the tax, that they understood the options before them and also if they did not believe it to apply to them, that they had the time in order to be able to appeal,\u201d Mamdani said.<\/p>\n

What should you do if you think you should be exempt?\u00a0<\/strong><\/p>\n

Property owners can exempt themselves from the surcharge if they can submit proof that their home was misidentified as a secondary residence. Documentation can be submitted through the DOF website. Individuals who believe DOF inaccurately assessed their property\u2019s value can also appeal online.\u00a0<\/p>\n

The clock is ticking. Under state law, DOF has until Aug. 30 to determine which properties are indeed primary residences.<\/p>\n

Read more Blakeman sets stage for election denialism<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

The Mamdani administration is managing the new pied-\u00e0-terre tax. The rollout is off to a rough start.<\/p>\n","protected":false},"author":1,"featured_media":515,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12,22,20,18,136],"tags":[15,24,21,19,137],"class_list":["post-516","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-budget","category-housing","category-new-york-city","category-policy","category-taxes","tag-budget","tag-housing","tag-new-york-city","tag-policy","tag-taxes"],"yoast_head":"\nWhat\u2019s a pied-\u00e0-terre tax and why do people care? - Business Relocation Digest<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/businessrelocationdigest.com\/?p=516\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What\u2019s a pied-\u00e0-terre tax and why do people care? - Business Relocation Digest\" \/>\n<meta property=\"og:description\" content=\"The Mamdani administration is managing the new pied-\u00e0-terre tax. 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