Understanding the NYC RPIE Statement: What Property Owners Need to Know

Admin - Saturday, July 23th 2024 03:20pm

If you own certain types of income-producing properties in New York City, you're likely required to file a Real Property Income and Expense (RPIE) statement each year. This filing is crucial for ensuring your property is assessed accurately and that you’re paying the correct amount in property taxes. Here's a simple breakdown to help you understand what the RPIE statement is, why it matters, and what you need to do.

What is an RPIE Statement?

An RPIE statement is a report that property owners in NYC must submit to the Department of Finance (DOF). It includes detailed information about the income you earn from your property and the expenses you incur to operate it. This information helps the city assess your property’s value and calculate your property taxes.

Who Needs to File an RPIE?

You must file an RPIE statement if you own an income-producing property in NYC with an assessed value greater than $40,000. This generally includes:

- Commercial properties(e.g., office buildings, retail spaces)

- Residential properties with more than three units

- Hotels and motels

- Parking garages or lots

Even if your property falls into one of these categories, there are exceptions and special cases, so it's important to check the specific requirements for your property.

What Information Do You Need to Include?

The RPIE statement requires you to report on various aspects of your property, such as:

- Income: This includes rental income and any other earnings from the property.

- Expenses: Report costs like utilities, maintenance, repairs, insurance, and property taxes.

- Property Details: You'll also need to provide details like the number of units, occupancy rates, and total rentable square footage.

Why is the RPIE Statement Important?

The city uses the information from your RPIE statement to assess your property’s value. This assessment determines how much you owe in property taxes. Additionally, the city analyzes these statements to track real estate trends across different boroughs, which can influence future tax rates.

Filing your RPIE statement accurately and on time is crucial. If you don't file, the city may estimate your property's value based on past data, which could result in higher taxes. Failing to file on time can also lead to penalties.

When and How to File?

The deadline to file your RPIE statement is typically in early June each year. For example, the deadline for RPIE-2023 is June 3, 2024, covering the calendar year from January 1, 2023, to December 31, 2023. If your property’s records are maintained on a fiscal year basis, the RPIE will cover the last complete fiscal year as of May 1, 2024. It must be filed online.

To find your property's assessed value, visit the [NYC DOF website] and look up your property’s information. You can also review the annual notice of property value sent to you by the city.

Special Cases and Exemptions

Certain properties are required to file a short form or claim an exemption instead of the full RPIE statement. For example, if your property's assessed value is $250,000 or less and it's not a hotel, you may be eligible to file a shorter version of the RPIE.

Other properties, such as those that are entirely owner-occupied or owned by not-for-profit organizations, may be exempt from filing the RPIE altogether. However, you might still need to file a claim of exclusion to certify that your property meets the exemption criteria. 

Property that is rented exclusively to a person or entity related to the owner, including the following:

1. Spouse, parents, children, siblings, and parents-in-law;

2. Owner-controlled business entities;

3. Business entities under common control; and

4. Fiduciaries and the beneficiaries for whom they act.

Here is the full list of exclusions: 

a. Has an actual assessed value of $40,000 or less.

b. Is exclusively residential with 10 or fewer apartments.

c. Is primarily residential with six or fewer apartments, no more than one commercial unit, and is in Tax Class 1, Tax Class 2A, or Tax Class 2B.

d. Is a residential cooperative apartment building with less than 2,500 square feet of commercial space (not including garage space).

e. Is a residential unit that was sold and is not owned by the sponsor.

f.  Is rented exclusively to a related person or entity.

g. Is occupied exclusively by the owner but is not a department store with 10,000 or more gross square feet; a hotel or motel; a parking garage or lot; a power plant or other utility property; a self-storage warehouse; a gas station; or a car wash or theater.

h. Is owned and used exclusively by a fully tax-exempt not-for-profit organization or government entity and generates no rental income.

i. Is vacant or uninhabitable and non-income-producing for the entire year.

j. Is vacant, non-income-producing land.

k. The owner has not operated the property and is without knowledge of the income and expenses for the entire calendar or fiscal year of the reporting period.

Penalties for Not Filing

If you miss the filing deadline or fail to file your RPIE statement, you could face penalties. These penalties can be as high as 5% of your property's assessed value. It's also important to note that willfully misreporting information on your RPIE can result in legal consequences.

Challenging Your Tax Assessment in Court? (TC150, TC201) 

If you are applying to challenge your tax assessment and there are multiple lots with the same entity as the owner, a single RPIE filing must be submitted before the due date, consolidating all lots into one submission.

You have any questions or inquiry? Please contact us info@arbstax.com