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Misfiled RPIEs may cause owners grief.

Owners whose Real Property Income and Expense Statements were defective or missing began receiving notification last week from the Department of Finance.

In spite of both financial and administrative penalties, more than 12,500 owners had not returned these forms, known as "RPIEs', by late September. The Department of Finance said they had received 60,000 of the 72,5000 RPIE booklets that were mailed. The forms were due back on Sept. 1 and a new count was not made available last week.

Because the notification letters are not going to the tax certiorari attorneys, observed Joel R. Marcus, president of the Tax Review Bar Association, there is a concern the initial mailing of RPIE booklets may also have gone to the wrong place the first time. There will be a listing by attorney group numbers available this week, he added.

The city is allowing those with detective notices to file corrections by Jan. 4. If the papers were, not filed, however, the city is only allowing owners to file an exclusion or produce proof of a previous filing by that date. Under Department of Finance regulations, non-filers will not be entitled to a tax commission hearing.

"I don't see how they can assess a penalty on someone who is not required to file and who is only required to file a notice stating that they are not required to file,' Marcus said late last week.

It was unclear, he noted, if those deemed to be non-filers will be allowed to file a new form. Spokespersons from Finance were not able to answer that question either. Not allowing a new filing would be a new position for Finance, which has in the past permitted compliance through the correction period without assessing financial penalties.

Last year, more than 600 properties were denied Tax Commission hearings because forms were not filed or were found to be defective and were not corrected.

All property owners with income producing properties that are assessed at $40,000 or more are supposed to file either an RPIE, an exclusion form, or an agreement to use the 1992 Tax Commission Income and Expense Statement, or be subject to penalties and fines. Non-residential or mixed use properties assessed at $1 million or more must also file addenda. RPIE information is confidential while Tax Commission figures are not.

Joe Dunne, a spokesperson for the Department of Finance said, "We conducted hearings about two years ago and handed out [monetary] penalties. But as far as this latest batch, considering the response, that total will no doubt increase."

Over the years since 1986 that Local Law 63 has been in effect, to encourage and make compliance easier Finance has minimized those items that would previously have made the forms defective. Last year, a defective form lacked a signature or an addendure, was completely blank, or blank on either the Income or Expense side.

Penalties for missing or defective filings begin with the property being disqualified from having an appeal of the assessed valuation heard before the Tax Commission. A 3 percent penalty may be imposed for filing after Sept. 1, a 4 percent penalty is made for not filing by Dec. 31 and a penalty of up to 5 percent of the assessed valuation may be made for not filing RPIE's two years in a row.

The harder stance Finance appears to be taking this year by not allowing for late filings may indicate that financial penalties are back in Vogue. In this era of budgetary tightness this may be one way the city can raise some much needed cash.

In September, Assistant Commissioner Jon Lukmonik said they have not made penalizing owners financially a priority in the past because the lack of appeal to the Tax Commission alone has increased compliance.

"In the interest Of voluntary compliance," he said, "we have asked the Tax Commission in the past to accept some of the late filings but there is nothing that says they must do so," he added.

Pinance's position is that if the owner has not exhausted the administrative remedies through an appeal to the Tax Commission, then they should not be able to appeal to the judicial system. Experts in the real estate tax field said, however, that there have been plenty of appeals made to the courts after by-passing the Tax Commission for one reason or another, including the lack of an Income and Expense statement filing.
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Title Annotation:real property owners receive notification from New York, New York Department of Finance regarding Real Property Income and Expense Statements
Author:Weiss, Lois
Publication:Real Estate Weekly
Date:Dec 23, 1992
Previous Article:Steven H. Klein.
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