The pied-à-terre tax (“PAT”) continues to make news and be at the forefront of City and State politics. Yesterday in an outright rejection of the Mamdani Administration's proposal, which went into effect on May 28, 2026, Supreme Court Justice Wayne M. Ozzi struck down the rollout of the PAT, ruling that the Department of Finance's plan was arbitrary and capricious and directing the City to start from scratch.
The Order specifically states that the City must remove the list of properties subject to the PAT from the Department of Finance website, prepare a revised list, and send new notices to the property owners included on that revised list. Though the current deadline for filing a pied-à-terre tax primary residence exemption is October 6, the deadline will most likely be changed again pending the issuance of the new notices. The City plans to appeal the decision and seek a stay of the Judge's Order thereby adding more uncertainty as to filing deadlines.
In addition, two new lawsuits were filed yesterday challenging the PAT's constitutionality. Former U.S. Commerce Secretary Wilbur Ross and Steve Wynn of Wynn Hotels are the plaintiffs in one such lawsuit, arguing that the PAT is unconstitutional because it targets only nonresidents of New York City. The second lawsuit was filed by homeowners and trustees, along with a New York City cooperative corporation, likewise challenging the tax's constitutionality. Notably, REBNY is also supporting this lawsuit.
We will continue to monitor developments and provide updates as they occur and potential filing deadlines approach.
Co-authored with Ross Moskowitz.
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