NYC Senior Citizen Homeowners’ Exemption (“SCHE”) Guide

August 16, 2021 by Georges Benoliel

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Everyone knows how expensive it is to live in New York City. It’s one of the most expensive cities to live in America and the entire world. So anyone that’s living there needs to try to take advantage of every tax break or exemption that they can. One such tax break is the NYC Senior Citizen Homeowners’ Exemption (“SCHE”). In this guide, we’ll go over everything you need to know about the SCHE. For instance, whether you’re a senior citizen yourself, you want to help out the senior citizens in your life, or you want to know as much as you can about the tax laws in NYC, this is the perfect article for you. In this guide, we’ll look at what the NYC Senior Citizen Homeowners’ Exemption is. Who’s eligible for the NYC Department of Finance Senior Citizen Homeowner Exemption?

How to estimate what your tax exemption would be, and more. For the sake of our readers, we will be presenting this information as if you’re looking into the tax exemption for yourself.

What is the NYC Senior Citizen Homeowners’ Exemption?

First, as the name suggests, the New York City Senior Citizen Homeowners’ Exemption is a tax break designed for senior citizen homeowners. More specifically, it’s a tax break that helps out senior citizens who own a one-, two-, or three-family home in NYC.

These homes can be houses, condominiums, or coop apartments. As long as a senior citizen owns them, they can potentially qualify.

At its core, the SCHE offers senior citizen homeowners a potential reduction of between 5% and 50% of the property tax on the home(s) in which they own. In NYC, getting a tax break of up to 50% of your property value can be a substantial amount. But not everyone qualifies.

The Senior Citizen Homeowners’ Exemption (SCHE) allows seniors (age 65 or older) with an annual income of $58,399 or less to reduce the property tax bill on their primary residence in NYC. This is accomplished by reducing the taxable assessed value of a qualifying senior’s home by up to 50%.

So let’s take a look at the eligibility requirements of the SCHE so you know if you can take advantage of this or not.

Who is Eligible for the SCHE in NYC?

As mentioned before, not everyone is eligible for the NYC Department of Finance Senior Citizen Homeowner Exemption. In fact, eligibility is based on age, income, residency, and ownership of the property. Therefore, to be eligible, you must meet all of the qualifications listed below:

1. Age — You must be at least 65 years of age or older. If you own the property with a spouse or a sibling, only one of you needs to be 65 years old. If you own it with others (besides a spouse or sibling), everyone needs to be 65 years old or older.
2. Income — The total combined annual income of all owners (whether that’s the owner and their spouse or the owner and a co-owner) has to be $58,399 or less. This includes all forms of income, including salary, self-employment income, dividends, Social Security, retirement payments, IRA earnings, capital gains, and more. It includes pretty much everything.
3. Residency — You must be using the property as your primary residence. This is true for all owners, whether that is a spouse, sibling, or other co-owner. If you’re receiving in-patient care at a medical facility and you’re technically living there, you can still qualify for the tax break on the property.
4. Property Ownership — You must be the property’s registered owner for the 12 months before applying for the exemption. If you are instead using your previous residence to claim the exemption, this does not apply.

Automatic Disqualifications of the NYC Senior Citizen Homeowners’ Exemption

Regardless of whether or not you meet the above qualifications, the following list comprises the things that will automatically disqualify you from receiving the benefits of the SCHE. So if any of the following three things are true for you, then you are not eligible for the SCHE:

1. You already receive the Disabled Homeowners’ Exemption (DHE). You are not eligible to receive both tax breaks concurrently.
2. Or, you own the property through your Limited Liability Company (LLC) rather than yourself. It has actually to be owned by you, the individual.
3. Lastly, you already receive exemptions through the 421a or 421b exemption program. You cannot receive exemptions from these and the SCHE at the same time.

If you meet all of the eligibility requirements and you don’t meet any of the automatic disqualifiers, then you are eligible for the tax break! So let’s take a look at how much it can save you.

How do You Estimate Your Tax Exemption from the NYC SCHE?

First, taxes are one of the most confusing times of the year for just about everyone who pays taxes in this country. All the different forms coming in through the mail and e-mail. Then, various streams of income that you need to keep track of.

Do you owe money, or will you be getting a refund? Which tax breaks or exemptions do you qualify for?

It can be a stressful time for many people.

When you’re talking about the Senior Citizen Homeowners’ Exemption, you’re talking about potentially saving a lot of money. So even though it can

be stressful to keep track, it’s essential to use every break you can have. Thankfully, to make this easier, New York City makes the SCHE reduction reasonably simple to estimate.

The exemption changes wildly with just a slight change in total income.

So you must nail down your total income and take all the deductions on your income that you’re able to as well. Ensuring you take advantage of everything you can means a big difference financially speaking when tax time comes around.

As a quick note to drive this point home, if you barely qualify for the SCHE with an income of $58,000, you’ll get to reduce your property tax bill by 5%. However, if you’re able to write off $8,000 of income and bring your combined income down to $50,000, you’ll be able to reduce that property tax year by a whopping 50%. So that’s how quickly this tax break scales.

So without further ado, here is the breakdown of what the SCHE can do for you. Therefore, take advantage of everything you can, and best of luck come tax time:

Income Range – Tax rate	SCHE property tax exemption by
$58,400 and Above	Ineligible
$57,500 – $58,399	5%
$56,600 – $57,499	10%
$55,700 – $56,599	15%
$54,800 – $55,699	20%
$53,900 – $54,799	25%
$53,000 – $53,899	60%
$52,000 – $52,999	35%
$51,000 – $51,999	40%
$50,001 – $50,999	45%
$50,000 and Less	50%

You can also call 311 to request a renewal application. If you inherit your recently deceased parent’s property, the Senior Citizen Homeowners Exemption NYC will be automatically removed by the Department of Finance. The recording of a deed, except for a life estate deed, automatically revokes the following exemptions:

• Basic or Enhanced School Tax Relief (STAR)
• Senior Citizen Homeowner Exemption (SCHE)
• Disabled Homeowner Exemption (DHE)
• Veterans or Clergy Exemption

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