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Adam Leitman Bailey, P.C. Works Hard to Correct Previous Agent’s Application Errors and Help Business Keep Hundreds of Thousands in Tax Benefits

By Carolyn Z. Rualo


On December 6, 2016, Mayor de Blasio, the Department of Finance and Housing Preservation and Development issued suspension notices to owners of more than 3,000 multiple dwellings that failed to comply with 421a tax benefit requirements. The notices gave owners one year, until January 5, 2018, to correct their mistakes and omissions or suffer suspension of tax benefits – or worse, pay back the tax benefits previously reaped. Our client, the owner of one of the targeted buildings located in the Bronx, came to us weeks after receiving the threatening notice, worried the City would require it to pay back ten years’ in abated taxes amounting to approximately $800,000. The owner hired a third party agent to handle the 421a application back in 2004 but that agent never secured a 421a Final Certificate of Eligibility. Meanwhile, the City applied the tax abatement to the property’s annual tax bills for ten years.

Adam Leitman Bailey P.C. investigated and identified where exactly the agent made mistakes in the application process by failing to submit various construction and rental documents to the City. We corrected the errors then brought the building into compliance with the registration requirements under the rent stabilization law. Then by immediately establishing relationships with the right City employees in the 421a unit, we ensured the benefits were not suspended and obtained a Final Certificate of Eligibility in time for the January 5, 2018 deadline. We maintained our contacts at the 421a unit throughout the one-year-long process of bringing the building into compliance by calling those contacts and making in-person visits to the 421a unit after each documentary submission. We ensured our documents were not lost in the over 3,000 files that the City had been called to review by this audit. Diligent follow up and constant communication with the City ensured timely results and saved the owner from having to return hundreds of thousands of dollars in abated taxes and ensured it could continue to enjoy the benefit for the life of the 25 year tax benefit period.

Adam Leitman Bailey, P.C.

NEW YORK REAL ESTATE ATTORNEYS