What You Need to Know About the Real Property Income and Expense (RPIE) Extension for Filing and the New RequirementsAnchin AlertMay 19, 2020
In response to the COVID-19 pandemic, the NYC Department of Finance (DOF) has extended the deadline for the submission of 2019 Real Property Income and Expense (RPIE) statements and storefront registry (new for this year - see below) filings from June 1, 2020 to July 1, 2020. Submissions must be filed electronically, unless you have previously been granted a waiver allowing you to file by mail.
New York City continues to expand the type of information real estate owners are required to disclose. Here is a brief reminder of certain filings required to avoid penalties and maintain your rights to challenge assessments.
What is an RPIE? Do I need to file? What happens if I don’t?
An RPIE statement is required by the DOF for most income-producing properties with an Actual Assessed Value of more than $40,000. There are certain properties that are excluded from having to file an RPIE. However, those owners still must file a Claim of Exclusion. In limited circumstances certain properties are not required to file an RPIE or Claim of Exclusion. Failure to file or filing past the due date may result in penalties and the owner losing the right to a hearing at the New York City Tax Commission to challenge their property assessments to reduce taxes.
New requirements for Storefront Registries and Rent Rolls:
Local Law 157 of 2019 requires the DOF to implement a storefront registry within one year of the effective date of the law (November 21, 2019). As a result, there is a new requirement for owners of ground-floor or second-floor commercial premises that are visible from the street and accessible to the public directly from the street or from the interior of the building, to file an annual registration statement providing information about the spaces. It applies to commercial premises that are occupied or used, or could be occupied or used, for offering or selling retail goods, food or beverages, or for providing personal or financial services. This includes restaurants and service sector firms operating in storefront spaces. Required information will include basic descriptive information about the premises, as well as information about the tenant leases including items such as: monthly rent per square foot, rent increases, start and expiration dates, lease concessions, owner occupied spaces, and vacancies, among other items. Keep in mind that you may be required to register even if you are not required to file an RPIE. If you meet the registry filing requirements and fail to file, you may be subject to penalties and can be assessed even if a property is not required to file an RPIE. The deadline to submit information is July 1, 2020. The storefront registry is included in section S of the RPIE filing. Click here for more information in the storefront registry user guide.
All residential and commercial properties that are required to file an RPIE and have an actual assessed value of $750,000 or more are required to file an addendum containing rent roll information. In the past, submitting a copy of your rent roll sufficed, but the information now required to be submitted, under the new guidelines, is information typically not included on most residential or commercial rent rolls and will be required to be submitted electronically in a format and spreadsheet provided by the DOF.
The information required to be submitted for residential properties include basic tenant information, occupancy status, time period vacant, rent-regulated status and detailed information regarding each unit (i.e. net rentable area, number of rooms/bedrooms, full bathrooms/half bathrooms, apartment style, etc). Required information for commercial properties in addition to basic tenant information includes detailed information regarding escalation charges, tenant improvements, leasing commissions, etc.
Unfortunately, the additional requirements issues by New York City will require owners to spend a significant amount of additional time gathering information. The deadline to submit the addendum is September 1, 2020.
Please reach out to your Anchin Relationship Partner or a member of our Real Estate Group so that we can personally address your questions and concerns. Click here for additional information regarding filing requirements.
Disclaimer: Please note this is based on the information that is currently available and is subject to change.