New York State and City Tax Tips
New York State Income Tax Credits
New Yorkers should always use care when calculating their tax returns. Before you start looking at tax credits, however, you should ensure that you have the right amount of income tax withheld from your pay. If you withhold too little, you may have to pay penalties; if you withhold too much, you are giving the federal government the equivalent of an interest- free loan.
- The Internal Revenue Service offers tax withholding calculators to help you determine the right amount of income tax you should withhold.
After determining your withholdings, one of the best ways to minimize your tax burden is to get more familiar with the tax credits available to New York residents, outlined on the New York State Department of Taxation and Finance's website. You may qualify to claim one or more tax credits, which will help reduce your New York State income tax liability. The explanations provided by the Department include:
- Child and Dependent Care Credit
- College Tuition Credit
- Earned Income Credit
- Empire State Child Credits
- Household Credit
- Long-Term Care Insurance Credit
- Real Property Tax Credit
More New York State Income Tax Credits
For specific information on the following credits, refer to the Department of Taxation and Finance's publication General Information on New York State and New York City Income Tax Credits for Individuals, which provides information on the following:
- Accumulation distribution credit
- Automated external defibrillator credit
- Claim of right credit
- Clean heating fuel credit
- Conservation easement tax credit
- Fuel cell electric generating equipment credit
- Green building credit
- Historic homeownership rehabilitation credit
- Home heating system credit
- Noncustodial parent earned income credit
- Nursing home assessment credit
- Resident credit
- Resident credit against separate tax on lump-sum distributions
- Solar energy equipment credit
- Volunteer firefighters’ and ambulance workers’ credit.
Income tax credits for businesses in New York State can be found at General business corporation (Article 9-A) tax credits
New York State Property Tax Exemption Program
The New York State Office of Real Property Services (ORPS) administers New York State's School Tax Relief (STAR) Program, including the Basic and Enhanced STAR Property Tax Exemptions. STAR is New York State's School Tax Relief Program that provides a partial property tax exemption from school taxes.
All New Yorkers who own and live in their home - whether it's a condominium, cooperative apartment, manufactured home, farm dwelling, apartment building or mixed-use property - are eligible for the STAR exemption on their primary residence. ORPS provides answers to STAR related frequently asked questions that can help you learn more, or call (518) 474-2982.
Basic STAR is available to anyone who owns and lives in his or her own home. You must apply once to receive this benefit. Your school property tax bill will show your STAR exemption and your tax savings. Enhanced STAR is available to senior homeowners whose incomes do not exceed the statewide standard, and provides a larger benefit. You must apply each year to receive this benefit. Exemption applications must be filed with your local assessor's office. The deadline is generally on or before the Taxable Status Date, which varies by municipality but for most is March 1 each year. Application forms can be found at the ORPS website.
New York City also offers a number of tax reduction programs to qualified individual owners of 1-, 2-, and 3-family houses, condominiums, and cooperative apartments, and also administers the STAR Program for New York City residents on behalf of the State. New York City residents should visit the New York City Department of Finance for more information or call (212) 504-4080.