2007-08 School Tax Relief (STAR)

Middle Class STAR Rebate Program

The enacted state budget includes an expanded property tax relief program that targets its benefits to middle income homeowners.

Find your STAR savings.

Adding income consideration to the distribution of property tax relief provided through STAR was a top budget priority for the Governor.

The Enacted Budget for fiscal year 2007-08 provides $1.3 billion in property tax relief by increasing the current STAR program with an additional benefit for middle-class taxpayers and increased benefits for seniors. STAR is currently projected to increase by $1.8 billion in 2008-09 and $2.2 billion in 2009-10 for a three-year cumulative increase of $5.3 billion. The additional benefit will be delivered to taxpayers in the form of a rebate check.

The centerpiece of the plan is the creation of a new Middle Class STAR program that will provide benefits to taxpayers on a sliding scale based on income, with benefits declining as income exceeds $90,000 for upstate homeowners and $120,000 for homeowners in the higher cost New York City metropolitan region. The percentage benefit added on a sliding scale basis for homeowners with income up to $250,000 will increase over the next three years and the income ranges to which the scale applies will be adjusted to reflect income growth during the period.

Upstate residents with incomes of $90,000 or less will receive a 60 percent additional benefit in 2007-08, a 10 percent additional benefit in 2008-09 and a 10 percent additional benefit in 2009-10. The middle class benefit to be provided through a rebate check is in addition to the Basic STAR benefit provided in the form of a reduction in the homeowner’s property tax bill.

More than 94 percent of all homeowners across New York State will receive additional tax relief under the Governor’s Middle Class STAR program, with 79 percent of homeowners qualifying for the maximum benefit.

The average Basic STAR savings upstate was $640 in 2006-07. As a result of the Governor’s Middle Class STAR program, for a family with income of $90,000 or less, the STAR benefit would grow by $384 to $1,024 in 2007-08.

In downstate counties outside of New York City, where property values and taxes are considerably higher, the average basic STAR savings was $1,082 in 2006-07. As a result of the Middle Class STAR program, for a family with income of $120,000 or less, this benefit would increase by $649 to a total STAR benefit of $1,731 in 2007-08.

In New York City, in addition to a middle class supplement for those receiving Basic STAR benefits, relief will be increased for all residents paying personal income tax with income of $250,000 or less. Married individuals filing joint returns will be eligible for a refundable credit of $290, up from $230 last year. All others will be eligible for a credit of $145, up from $115 last year.

The Enacted budget will increase the Enhanced STAR benefit for seniors by 25 percent and make the cost of living adjustment for the Senior STAR program permanent.

STAR Facts

• In 2007-08, the State will provide property tax relief totaling nearly $5 billion. This includes $2.8 billion for property taxpayers and $940 million for senior property taxpayers, as well as $1.1 billion for New York City residents who pay personal income tax.
• The New York City Personal Income Tax (PIT) benefit, provided in the form of a credit, is increasing from $230 to $290 for married individuals filing joint returns and from $115 to $145 for all others with income below $250,000. 3.3 million NYC taxpayers are expected to receive the STAR PIT benefit.
• The additional benefit will be provided in the form of a rebate check. Basic and Enhanced STAR benefit will continue to be provided in the form of a credit that reduces the amount of property tax owed.
• To recognize relative property tax burdens and differing income levels Upstate and in the NYC Metropolitan region, the maximum additional benefit is provided to homeowners with income of:
  • $90,000 or less Upstate, and
  • $120,000 or less in the NYC Metropolitan region including NYC, LI, Westchester, Rockland, Putnam, Dutchess and Orange Counties.
  • Taxpayers with income of more than $250,000 will not receive an additional benefit.

Increases for 2007-08
Figures below represent amount of increase eligible taxpayers
will receive from prior year

• The budget supports a $1.3 billion increase in the STAR program.
  • STAR will increase by $1.8 billion in 2008-09 and $2.3 billion in 2009-10