Preserving Value The Easy Way: Do Your RPIE Filing Now
May 20, 2017
My team hosted a well attended event on Thursday night in Brooklyn Heights. Our theme was “Unlocking Unrealized Value.” While our panelists discussed a number of sophisticated and creative ways to improve a property’s value, we all overlooked an important and timely way to preserve a property’s value: simply file its RPIE statement fully and on time. Every year New York City requires owners of income properties to submit real property income and expense filings, and the filing deadline is June 1. This filing can be the single most important step to maintain an appropriate tax assessment. The stakes are highest for properties which, for any number of reasons, have below-market income. In an apartment building, below-market income may be due to the high frequency of rent regulated apartments. In a retail property, it could be due to a unit with a legacy retail lease that was inked long before the retail rents skyrocketed. The failure to submit an RPIE filing will trigger a penalty. However it will trigger a much larger and long-lasting problem. The City’s Department of Finance will assume that the property’s net operating income is strong enough to warrant a high tax assessment. There is an old saying that New York property owners are “guilty until proven innocent.” Failing to file RPIE triggers the equivalent assumption: the Department of Finance believes properties are highly profitable (and taxable as such) until proven otherwise.
New York City’s filing deadline for RPIE statements is June 1. Owners who fail to make the filing are exposed to a significant over-assement.We meet owners all day, every day. The most common oversight we stumble upon is the failure to complete the RPIE’s simple and inexpensive filing. By falling into this trap, owners are exposed to significant over assessments and eight long difficult and expensive process to appeal. We always encourage our clients to avoid this problem. June 1 is the deadline. Now is the time to maintain fair tax treatment for your property. … And unlock unrealized value!