For the tax year running July 1, 2025 through June 30, 2026, NYC property tax rates are 19.843% for Class 1 one- to three-family homes, 12.439% for Class 2 larger residential buildings, 11.108% for Class 3 utility property, and 10.848% for Class 4 commercial and industrial property.1Department of Finance. Property Tax Rates Those percentages look steep on their own, but each is applied to a taxable assessed value that is only a slice of what your property would sell for. The City Council resets the rates every year based on the city budget.
How the Rate Turns Into a Bill
The Department of Finance starts with an estimate of what your property would sell for on the open market. That figure appears on the Notice of Property Value mailed to every owner each January, along with the assessed value that will drive the following tax year.2Department of Finance. Notice of Property Value
Assessed value is a fixed share of market value, set by your tax class:
- Class 1: 6% of market value
- Classes 2, 3, and 4: 45% of market value3NYC Department of Finance. Definitions of Property Assessment Terms
Take a Class 1 home with a $600,000 market value. Its assessed value is $36,000. Subtract any exemptions to get the taxable assessed value, then multiply by 19.843%. A Class 4 building at the same $600,000 market value is assessed at $270,000 and taxed at 10.848%. That is why the headline rate can be misleading. The effective burden on a Class 1 home works out closer to 1.2% of market value once the 6% assessment ratio is factored in, though your own number depends on your exemptions.
Which Class Your Property Falls Into
New York Real Property Tax Law Section 1802 sorts every parcel in the city into one of four classes, and the class fixes both your assessment ratio and your rate.4New York State Senate. New York Real Property Tax Code 1802 – Classification of Real Property in a Special Assessing Unit
- Class 1 covers one-, two-, and three-family homes, small condominiums of three stories or fewer, and certain qualifying vacant residential land outside Manhattan.
- Class 2 covers other primarily residential property: cooperatives, condominiums over three stories, and rental buildings with four or more units. It breaks into sub-classes by unit count (2a for 4–6 units, 2b for 7–10 units, 2c for small co-ops and condos, and the main Class 2 for 11-plus units).
- Class 3 is utility company property.
- Class 4 is everything else: office buildings, retail space, factories, and any real estate not covered by the first three classes.
If a property has more than one use, the Department of Finance assigns a class based on the primary use. Misclassification carries a real cost, because a wrong class means both the wrong assessment ratio and the wrong rate.
Caps on How Fast Assessments Can Rise
State law limits how much your assessed value can climb year over year, which cushions the rate against a hot market. For Class 1, assessed value cannot rise more than 6% in one year or 20% over five years. Small Class 2 buildings in the sub-classes face an 8% annual cap and 30% over five years.5New York State Senate. New York Real Property Tax Code 1805 – Limitation on Increases of Assessed Value of Individual Parcels The caps do not shield you from new construction or major renovations, which are added at full value right away.
For larger Class 2 buildings (more than 10 units) and all Class 4 properties, the city phases assessment changes in over five years at 20% per year. If that transitional assessed value comes in below the actual assessed value, the city bills off the lower figure.6NYC Department of Finance. Determining Your Transitional Assessed Value
Exemptions and Abatements That Lower What You Pay
An exemption reduces your assessed value before the rate is applied. An abatement is a dollar credit taken off the tax itself. Both cut the bill, at different points in the math.
STAR
The School Tax Relief program reduces school taxes for owners who occupy their home as a primary residence and whose household income is $500,000 or less. Basic STAR is open to all eligible owners; Enhanced STAR is for owners 65 or older with income of $110,750 or less for the 2026–2027 school year.7New York State Department of Taxation and Finance. Types of STAR Owners who bought after 2015 receive the STAR credit as a check or direct deposit from the state rather than an exemption on the bill. The approximate annual exemption benefit in the city is around $293.8New York State Department of Taxation and Finance. STAR Resource Center
Senior and Disabled Homeowner Exemptions
SCHE cuts assessed value by up to 50% for owners 65 or older of a one-, two-, or three-family home, condo, or co-op used as a primary residence. Combined income at or below $50,000 gets the full 50%; the benefit slides down in steps, reaching 5% at income between $57,500 and $58,399, and disappears above $58,399.9New York City Department of Finance. Senior Citizen Homeowners’ Exemption (SCHE)
DHE uses the same thresholds and sliding scale for owners with qualifying disabilities, regardless of age. You cannot receive both; where an owner qualifies for each, the city applies SCHE.10New York City Department of Finance. Disabled Homeowners’ Exemption (DHE)
Veterans
Veterans who served during a designated conflict period, from the Mexican Border Period through the ongoing Persian Gulf conflict, may qualify for exemptions on residential property, with additional reductions for combat veterans and those with VA-recognized service-connected disabilities.11New York State Department of Veterans’ Services. Property Tax Exemptions for Veterans
Co-op and Condo Abatement
Owners who use their co-op or condo unit as a primary residence receive a direct credit against the tax, sized by the average assessed value of residential units in the development:
- $50,000 or less: 28.1%
- $50,001–$55,000: 25.2%
- $55,001–$60,000: 22.5%
- $60,001 and above: 17.5%
The abatement is applied automatically in most cases, but only if the unit is your primary residence.12New York City Department of Finance. Cooperative and Condominium Property Tax Abatement
Clergy
Members of the clergy, and their unremarried surviving spouses, can receive a reduction of up to $1,500 per year in assessed value on a primary residence they own and occupy.13NYC311. Clergy Property Tax Exemption
When the Bill Is Due
Billing frequency turns on assessed value. Properties at $250,000 or less get quarterly bills due July 1, October 1, January 1, and April 1. Properties above $250,000 are billed semi-annually, due July 1 and January 1.14New York City Department of Finance. Property Tax Due Dates You can pay online through the Department of Finance property tax portal, mail a check with your borough, block, and lot number, or pay in person at a business center. If your mortgage servicer escrows for taxes, the bill goes to them.
What Late Payment Costs
Interest starts accruing the day after the due date. For the fiscal year July 1, 2025 through June 30, 2026:
- Assessed value $250,000 or less: 6% annual interest
- $250,001–$450,000: 9%
- Over $450,000: 16%
These rates are set each year by local law and can change.15New York City Department of Finance. Late Payments Fall far enough behind and the city can sell your tax lien to a private trust, which can then add its own interest and fees. Within 90 days of a lien sale, the city sends you the new lienholder’s name, address, and contact information, and roughly $300 in administrative costs get added for advertising and notices.16NYC.gov. Lien Sales
If paying in full isn’t possible, the Department of Finance offers three plan types. A standard plan runs up to 10 years, monthly or quarterly. The PT AID program lets eligible homeowners defer some or all of their taxes based on income. A reduced-interest plan is available to Class 1 owners with an assessed value of $250,000 or less, household income of $200,000 or less, and at least one year of primary residency; the interest rate on that plan is 2.5% instead of the standard 6%. Missing six months of combined installment and new-charge payments defaults the plan, makes the property eligible for lien sale, and blocks you from a new agreement for five years.17NYC Department of Finance. Property Payment Plans
Challenging the Value the Rate Is Applied To
The rate itself isn’t negotiable, but the market value and classification behind it are. Challenges go to the New York City Tax Commission, an independent agency with authority to correct assessments.18Tax Commission. Forms
For the 2025–2026 tax year, applications for Class 2, 3, and 4 property are due by March 2, 2026. Class 1 owners have until March 16, 2026. Class 1 owners file Form TC108; Class 2 and Class 4 owners other than condominiums use Form TC101; owners of rent-producing property file Form TC201.19NYC.gov. Application Forms
Your application must include evidence that market value was overstated or the class is wrong. The Commission may offer a reduction or schedule a hearing. If you reject the offer or the Commission confirms the original figure, you can escalate to state Supreme Court by filing an Article 7 tax certiorari petition. For 2025–2026, that court filing must be made by October 24, 2025, which often falls before the Commission finishes its own review, so many owners file protectively and withdraw the petition if the Commission resolves the matter.20NYC Tax Commission. Challenging Notice of Property Valuation A $50,000 overstatement in market value on a Class 1 home works out to roughly $600 a year in excess taxes at current rates, so the math on a challenge depends on how far off you believe the city’s number is and how many years the correction will hold.