NYC Property Tax Bill: Exemptions, Due Dates, and Appeals

Your NYC property tax bill comes from the Department of Finance and is built from three things: your property’s assessed value, the tax class it falls into, and any exemptions you’ve been granted. Multiply the taxable value by your class’s rate and you have the annual tax. Everything else on the bill, and most of what can go wrong with it, traces back to those three inputs.

Property taxes are the city’s largest revenue source, accounting for roughly 44% of all city tax dollars in a recent fiscal year.¹ That scale is why small errors on an individual bill, like a dropped exemption or a missed deadline, add up fast.

Reading the Numbers on Your Bill

Three values on your bill look alike and mean different things. The market value is what the Department of Finance estimates your property would sell for. The assessed value is a percentage of market value set by your tax class, and it’s the figure the city actually uses in its calculation. The taxable value is assessed value minus any exemptions or abatements. Your tax rate gets applied to that last number.²

If you receive benefits like the Senior Citizen Homeowner’s Exemption or the co-op/condo abatement, they appear as line items. Check them every year. The Department of Finance sometimes drops exemptions when renewal paperwork is late or ownership records don’t line up, and owners who miss it overpay until the next cycle.

How the City Calculates What You Owe

NYC sorts all property into four tax classes, each with its own rate set annually by the City Council.³ Class 1 is one-to-three-family homes and condos three stories or fewer. Class 2 is other primarily residential property, including rental buildings, cooperatives, and larger condos. Class 3 is utility equipment. Class 4 is commercial and industrial property.²

For fiscal year 2026, the provisional rates are 20.630% for Class 1, 12.340% for Class 2, 11.114% for Class 3, and 10.774% for Class 4. The Class 1 number looks alarming until you factor in that Class 1 assessed values are set at only 6% of market value. A home with a $1 million market value might have an assessed value of $60,000, so the real tax burden on the full market value is a small fraction of the headline rate.

Caps That Limit How Fast Your Assessment Can Rise

State law limits annual increases in assessed value, which keeps a hot market from doubling your bill overnight. Class 1 assessed values cannot rise more than 6% in one year or 20% over five years.⁴ Class 2 buildings with 10 or fewer units are capped at 8% a year and 30% over five years.⁵ Larger Class 2 buildings and all Class 3 and 4 properties have no caps, which is why commercial owners and large landlords can see sharp year-over-year jumps.

When a cap applies, your Notice of Property Value shows an “effective market value,” a lower figure that reflects what the city is allowed to tax. If you see that line, the caps are holding your assessment below what the Department of Finance thinks your property is actually worth.

Due Dates, Grace Periods, and Late Interest

Your payment schedule depends on your assessed value. Properties assessed at $250,000 or less are billed quarterly, due July 1, October 1, January 1, and April 1. Properties above $250,000 are billed semi-annually, due July 1 and January 1.⁶ Bills are generally mailed about a month before each due date.¹

Quarterly payers get a 15-day grace period. Payment received by July 15, October 15, January 15, or April 15 is on time with no interest. If the 15th falls on a weekend or federal holiday, the deadline moves to the next business day.⁶ Semi-annual payers get no grace period.

Miss it, and interest runs retroactively from the original due date, compounding daily. For fiscal year 2026:

Assessed value $250,000 or less: 6% annual interest.
Assessed value $250,001 to $450,000: 9% annual interest.
Assessed value over $450,000: 16% annual interest.

⁷

The City Council sets these rates annually, so they can change each July 1.

How to Pay

You need your Borough, Block, and Lot (BBL) number, a ten-digit code identifying your parcel. The first digit is the borough (1 Manhattan, 2 Bronx, 3 Brooklyn, 4 Queens, 5 Staten Island), followed by a five-digit block and four-digit lot.⁸ It appears on any previous bill, on your deed, and in the Department of Finance’s address search.

The NYC CityPay portal is the fastest option. Enter your BBL or address and choose a payment method.⁹ E-check payments using your bank routing and account numbers are free. Credit and debit card payments carry a non-refundable 2% service fee.¹⁰ On a $5,000 quarterly bill, that fee is $100.

You can also mail a check with the voucher from your bill. Write your BBL on the memo line. Mailed payments take seven to ten business days to process, so send early. After any payment, confirm it posted by checking your account on the Department of Finance site.¹¹

If Your Mortgage Has an Escrow Account

With an escrow account, your lender or servicer collects part of your property taxes each month and pays the city for you. Federal rules under the Real Estate Settlement Procedures Act require servicers to pay on or before the deadline to avoid penalties, provided your mortgage payment is no more than 30 days overdue.¹² Even when the escrow is short, the servicer generally must advance the funds.

Review your annual escrow statement. Servicers sometimes miscalculate, and a late payment can show up as a penalty on your property tax account before you know anything went wrong.

Exemptions and Abatements That Reduce Your Bill

Several programs cut what you owe directly. Most require annual renewal, and the city will not apply them retroactively if you miss the deadline.

STAR (School Tax Relief)

STAR reduces the school tax portion of your bill. If you’ve received the STAR exemption continuously since 2015, you can keep it on the same primary residence.¹³ New homeowners can no longer get the exemption. Instead, you register for the STAR credit through New York State, which sends a check rather than reducing the bill.¹⁴ Enhanced STAR is a larger benefit for homeowners 65 and older who meet the income rules.

Senior Citizen Homeowner’s Exemption (SCHE)

SCHE reduces your assessed value by 5% to 50% based on household income. You must be at least 65, earn no more than $58,399 in combined household income, and use the property as your primary residence.¹⁵ At incomes under $50,000, the assessed value drops by half. Applications are due by March 15, and you must renew annually.

Disabled Homeowners’ Exemption (DHE)

DHE uses the same 5% to 50% structure as SCHE but applies to property owners with qualifying disabilities regardless of age. The same $58,399 income cap and March 15 deadline apply.¹⁶ If you qualify for both SCHE and DHE, you receive SCHE only; the city won’t stack them.

Veterans Exemptions

Veterans may qualify for the Alternative Veterans Exemption or the Cold War Veterans Exemption. The Alternative Veterans Exemption offers a 15% reduction in assessed value for service during a period of conflict, with additional reductions for combat zone service and disability.¹⁷ The property must be the veteran’s primary residence.

Cooperative and Condominium Abatement

Co-op and condo owners can receive an abatement of 17.5% to 28.1% a year, depending on the average assessed value of units in the building. Individual owners don’t apply. The building’s board of managers or board of directors files on behalf of the whole development between August 3 and February 15.¹⁸ The unit must be your primary residence and cannot be owned through an LLC. Buildings with higher-value units may need to file a prevailing wage affidavit; if the board misses that filing, the whole building loses the abatement for the year with no exception process.

Challenging Your Assessment

If you believe the Department of Finance overvalued your property, you can appeal to the NYC Tax Commission, an independent agency with authority to reduce your assessed value, change your tax class, or adjust exemptions.¹⁹ Deadlines are firm. March 15 for Class 1, March 1 for Classes 2, 3, and 4. Late filings are rejected.

To win, you must show that your property’s current market value is less than the city’s figure. For capped properties, that means proving actual market value is below the effective market value. Useful evidence includes a recent appraisal, comparable sales nearby, and documentation of physical conditions that reduce value. Many owners hire property tax attorneys or consultants who work on contingency and only get paid if they lower the bill.

You are challenging the assessed value, not the tax rate. Even a successful appeal does not change what the City Council sets. It changes the number the rate applies to.

What Happens If You Don’t Pay

Unpaid property taxes follow a predictable escalation. Interest accrues daily from the original due date at the rates above. After enough time passes, the city can sell a lien on your property to a third-party debt buyer.

A tax lien sale does not mean your property is sold. It means the city transfers your debt to an authorized buyer, who then has the right to collect what you owe, including interest and fees. The timeline depends on property type. For most owner-occupied one-to-three-family homes, taxes must be at least three years overdue. For commercial properties and other categories, the threshold can be as short as one year.²⁰

Once a lien is sold, the lienholder can begin foreclosure as early as one year after the sale if you haven’t paid in full or entered a payment agreement. Foreclosure can start sooner if you miss a semi-annual interest payment to the lienholder or let current taxes go unpaid for six months.

Payment Plans Before It Gets That Far

If you’re behind, the Department of Finance offers payment plans that spread the balance over time, up to 10 years in some cases. The standard plan allows monthly or quarterly installments for up to 10 years with no required down payment. The PT AID plan lets eligible homeowners defer part or all of their property tax payments based on income. The reduced interest plan drops the rate to 2.5% and is available to owner-occupants of Class 1 properties assessed at $250,000 or less with combined household income under $200,000.⁷

Once you’re on a plan, you must keep up with both your installments and your current tax charges. Fall behind on either for six months and the agreement defaults. After a default, you cannot enter a new payment plan for that property for five years unless you make a 20% down payment on all outstanding charges.⁷

Deducting NYC Property Taxes on Your Federal Return

NYC property taxes are deductible on your federal return if you itemize, but the state and local tax (SALT) deduction is capped. For 2025 and later tax years, the cap is $40,000 for most filers and $20,000 for married filing separately, subject to a modified adjusted gross income limitation, though the deduction cannot be reduced below $10,000.²¹ For many NYC property owners, especially those in higher-value properties who also pay state income tax, the SALT cap means you won’t get a full federal deduction for every dollar you pay the city.

1
Department of Finance. Bills and Payments
2
New York City Department of Finance. Definitions of Property Assessment Terms
3
Independent Budget Office. Legal and Practical Implications of the City Council Formulating and Adopting the City Budget
4
New York State Senate. New York Real Property Tax Law 1805
5
New York City Department of Finance. Determining Your Assessed Value
6
New York City Department of Finance. Property Tax Due Dates
7
New York City Department of Finance. Property Payment Plans
8
NYC311. Borough-Block-Lot (BBL) Lookup
9
NYC311. CityPay
10
NYC CityPay. CityPay FAQ
11
New York City Department of Finance. Property Tax Bills
12
Consumer Financial Protection Bureau. Escrow Accounts
13
New York State Department of Taxation and Finance. STAR Eligibility
14
New York State Department of Taxation and Finance. STAR Resource Center
15
NYC311. Senior Citizen Homeowners’ Exemption (SCHE)
16
ACCESS NYC. Disabled Homeowners Exemption (DHE)
17
New York City Department of Finance. Veterans Exemptions
18
New York City Department of Finance. Cooperative and Condominium Property Tax Abatement
19
New York City Department of Finance. Challenge Your Assessment
20
New York City Department of Finance. NYC Property Tax Lien Sale
21
Internal Revenue Service. Topic No. 503, Deductible Taxes