New York City’s Annual Income and Expenses: Statement Filing Requirement – a Land Mine for the Unwary Purchaser or Owner of Real Property
McCaffrey, Ryan A.; Lichy, Albert D.
Since 1986, New York City law has required owners of incomeproducing properties in New York City to file an annual income and expense statement, colloquially referred to as an RPIE statement, with the Department of Finance. The general purpose of an RPIE statement is to assist the Department of Finance in assessing the value of income-producing properties.1 To this end, the owners of income-producing properties are required to submit annually a statement that outlines “all income derived from and all expenses attributable to the operation of such property.”2 Despite the draconian penalties for non-compliance - ranging from 3% to 5% of the assessed value of the property - a systemic failure of the City of New York to enforce non-compliance over the subsequent decades following the regime’s enactment has led to a general unawareness of the RPIE statement filing requirements in New York City. As a result, potential purchasers of real property have failed to adequately protect themselves - in both the due diligence process and the acquisition agreement - from the consequences of a seller’s historic non-compliance with the RPIE requirements.
Cornell Real Estate Review
Volume & Issue:
Cornell University; real estate; RPIE statement; owners; income- producing; properties; 1986; Department of Finance; assessing; value; New York City; tax; records; collection; title; insurance; purchaser; lien; mortgage; documents; property; owners; income; file; rental; co-ops; net-lease; commercial; condominiums; govern; claims; exclusions; penalties; due process; purchase; filing; protections; tenant; timeframe; statute
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