real property tax credit NY IT 229

[az148]

is this credit available for tax year 2024? is this credit only for NY residents?  I couldn't find any info on the IRS website

[AndrewK24]

I believe this is only applicable to NY State.   Here is a link with more information: Instructions for Form IT-229 (ny.gov)

[PatriciaV]

According to the New York Department of Taxation, the Real property tax relief credit has no expiration date at this time. Tax law changes from year to year, so you may wish to check the state website later this year.

You are entitled to this refundable credit if you meet all of the following requirements for the tax year:

• you are subject to tax under Tax Law Article 22,
• you were a New York State resident for all of the tax year,
• your qualified gross income is $250,000 or less,
• you owned and primarily resided for six months or more of the tax year in real property that received the STAR exemption or that qualified you for the STAR credit,
• any rent you received from nonresidential use of your residence was 20% or less of the rental income, and
• you are the one that paid real property taxes on the property fully or partially.

@az148 

[az148]

Are we supposed to tell our accountant that we qualify for the credit? because turbotax system automatically filled out the form last year but this year it didn't show up.

[JotikaT2]

If you qualify based upon the information provided by PatriciaV above, then yes, you can let your accountant know you qualified in the past for the credit and you want to make sure you don't miss it in 2024.  Be aware, the form does not get filed until you complete your 2024 tax return in early 2025.

[az148]

Im confused - what do you mean by 'the form does not get filed until 2025' ? It needs to get filed for tax year 2023, no? @JotikaT2 

[LenaH]

TurboTax will automatically fill out form IT-229 if you qualify for the credit based on the entries you make on the screens of the New York return. If you qualify for the credit in 2023 and your return has been accepted by NYS without the credit, then you have to amend your state return to take the credit. 

To be eligible for this credit, you must meet all the following requirements in 2023 as per the IT-229 instructions:

• you are a New York State taxpayer ;
• you were a New York State resident for all of the tax year;
• you owned real property that:
  • was your primary residence for six months or more of the tax year, and
  • received the STAR benefit as either an exemption or a credit;
• any rent you received from nonresidential use of your residence was 20% (0.2) or less of the total rental income you received**;
• you paid the real property taxes on the property fully or partially; and
• your qualified gross income was $250,000 or less.

**NOTE: This question can be tricky. If no rental income was received, you must answer Yes during the interview for the third question on the screen, Claim for Real Property Tax Relief Credit. Please see the screenshot below for further clarification. 

For instructions on amending your state return, click here. You will get to the screen, Claim for Real Property Tax Relief Credit (IT-229), as you go through the screens of your NY return. Answer accordingly and the credit should populate on your amended return. 

@az148 

[az148]

is this a refundable credit? @LenaH 

[LenaH]

Yes. Per NYS IT-229 instructions, if you do not use the full amount of the credit for the current tax year, you may request a refund or credit the overpayment to the next year’s tax liability. 

@az148