Wealthy New Yorkers are seeking exemptions to Mayor Zohran Mamdani's second-home tax, with thousands filing applications to avoid the levy.
New York City Hall confirmed to FOX Business that as of Monday, about 4,800 property owners have started the process of applying for an exemption to the pied-à-terre tax. Of that total, about 2,000 property owners have completed their exemption applications.
The pied-à-terre tax is levied on single-family homes, apartments and condos that are used as a second home or a part-time residence instead of being the primary residence of the owner. It will be due on the city's standard property tax payment schedule.
Mamdani announced the implementation of the new tax in late July and billed the policy as a way of fulfilling his pledge to raise taxes on wealthy New Yorkers.
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"On Tax Day earlier this year, I promised that we would tax the rich, and with our new pied-à-terre tax, that is exactly what we have done," Mamdani said in announcing the tax.
"Today is the first step in implementing this tax and collecting critical revenue to fund our parks, schools and libraries. We will diligently implement this law and ensure that we collect what working New Yorkers – and this city – deserve," the mayor added.
In late July, the city published a list of more than 900,000 properties in a "supplemental market value roll" without explaining that the vast majority of them wouldn't face the pied-à-terre tax. The list was updated on Saturday to clarify that the New York City Department of Finance only sent surcharge letters pertaining to 17,000 properties, and that only those recipients need to apply for an exemption.
The pied-à-terre tax levies a surcharge of 0.8% on family homes valued between $5 million and $15 million; 1.05% between $15 million and $25 million; and 1.3% for homes over $25 million.
Condos and co-ops have higher rates, including 4% for those valued between $1 million and $3 million; 5.25% between $3 million and $5 million; and 6.5% on those over $5 million.
Individuals who have been notified about being potentially subject to the pied-à-terre tax have until Sept. 18 to apply for an exemption, according to the New York City Department of Finance. That deadline was extended from the original deadline of Aug. 21.
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Applicants who seek an exemption on the grounds that it's their primary residence will have to provide either their most recent tax return filed at the federal or state level, or their driver's license. Alternatives would include a voter ID card or other evidence of it being a primary residence.
Tenants will need to provide those primary residence documents as well as a copy of their current lease and an additional rental document – such as a utility bill, proof of rent payment or renter's insurance policy. They may also submit an affidavit with two additional rental documents.
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FOX Business' Sumner Park and James Cirrone contributed to this report.