Property owners can reduce or completely eliminate the amount of municipal taxes they must pay through tax incentive programs administered by HPD. In order to be eligible, owners need to offer affordable units or other investment benefiting public living. However, not all property owners have the knowledge and energy to navigate through all compliance requirements and apply.
First of all, let’s discuss the differences between tax exemption and abatement. New construction or rehabilitation to a property may be eligible for a full or partial tax exemption of the increased assessed value. On the other hand, tax abatement generally provides tax reduction for rehabilitated property based on the cost of the improvement in the form of credit.
HPD administers and also ensure compliance for following tax incentive programs:
As a result, approved tax benefits are applied by the Department of Finance. Additionally, the owner may need to remain in compliance after the benefit periods.