STAR benefits: Credits, exemptions, rebates, and deadlines for school tax relief in New York

ALBANY, N.Y. (NEXSTAR) — New York homeowners can save on property taxes through the School Tax Relief ( STAR ) program, which can be worth hundreds of dollars. Those who are enrolled are receiving payments now or should receive them by year’s end.

The benefit formula is based on the first $30,000 of the full value of an owner-occupied primary residence. STAR comes in several flavors, covering Basic and Enhanced , exemptions and credits. Under Basic STAR:

• Homeowners of any age are eligible
• The home must be the primary residence
• Maximum household income of $500,000

While under Enhanced STAR (E-STAR):

• At least one homeowner must be 65+ by year’s end
• Household income of $98,700 or less (for 2024), or $107,300 or less (for 2025)
• Basic STAR required

To check your STAR status, contact the New York State Department of Taxation and Finance or use their property tax credit lookup tool online. New homeowners or those not already enrolled have to apply.

First, when your home becomes your primary residence, register for the STAR credit by creating an account and logging in with the Department of Taxation and Finance. Keep the confirmation number from this transaction, fill out all the forms in the application, and provide necessary documentation like tax forms as proof of income and licenses as proof of your identity.

You have to register for the credit within three years of your tax filing deadline for the year you want the credit. But you don’t need to register again each year, and the Department of Taxation and Finance automatically selects whichever credit you qualify for, be it Basic or E-STAR.

Married couples with more than a single property only get credit for one property, unless documentation proves that they are divorced or legally separated. Also, homeowners should close their registration if they sell the property.

Apply for the credit by Dec. 31, 2024, to get the Basic benefit in the next tax year. In most areas of the state, the deadline to apply for E-STAR comes on March 1 . To upgrade to E-STAR, apply for it by March 1 during the calendar year when you turn 65. Seniors who miss the E-STAR application deadline might still have time to apply with a valid reason.

The Tax Department can’t calculate STAR benefits until districts release tax bills because local school tax rates represent a crucial variable in the savings formula. Still, Basic STAR averages about $290 in savings per household, while E-STAR averages about $650 per household.

Even so, the Department warned: “It may depend on your school district. For example, in 2023, some Albany County residents received as much as $1,885 in tax savings, while eligible homeowners in Suffolk could have received as much as $2,695.”

To opt-in to direct deposit, which is faster, you have to enroll through the online portal with the Department at least a week before local distributions start. Most homeowners get their STAR credit before or around when they get their school tax bill. Depending on when your district files its taxes, you could even get an interest payout if you registered for the credit by July 1.

The STAR credit represents a payment in the form of a check or direct deposit, while the STAR exemption reduces your school tax bill. The exemption is only available to legacy homeowners who had the exemption before 2015 and still meet the income requirements. A previous owner can’t transfer an exemption to a new owner. Current exemption recipients would need to reapply to switch from Basic to Enhanced, or in case of a marriage, divorce, or other change in who owns the property.

Credits can increase by as much as 2% each year, but exemptions are capped . And the dollar amount for either one might actually drop from year to year. What’s more, switching from the exemption to the credit—getting a direct payment instead of a tax reduction—cannot be undone.

According to the Department of Taxation and Finance website, “In 2023, 562,000 seniors received more than $815 million in savings from the Enhanced STAR property tax exemption.”

The STAR program dates back to the Pataki Administration, and the transition from exemption to credit helps illustrate the evolution. “STAR exemptions were a lifeline,” said State Sen. Jake Ashby, a Republican who represents New York’s 43rd Senate District. “Now, they’re a bandaid.”

Ultimately, Sen. Ashby blames what he perceives as an unreasonable cost of living in New York on partisanship. “If you want policies focused on affordability, you need bipartisan checks and balances in Albany, not one-party control,” he said. “I sponsor a $2.4 billion property tax cut that would structurally reform the system and relieve municipal governments from the burden of funding Medicaid.”

Ashby said his tax cut— S8648 / A9431 —would save upstate taxpayers about $2.6 billion. Though it never got out of committee, if passed, it would have slowly lowered how much the state paid for medical reimbursements. Reimbursements would be cut each year until 2033, when reimbursements end altogether. Every year, the money saved would have to be used for lowering property taxes or issuing property tax rebates.

For the latest news, weather, sports, and streaming video, head to NEWS10 ABC.