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Volume 1 - Opinions of Counsel SBEA No. 34

Opinions of Counsel index

Aged exemption (ownership requirements) (life estate) - Real Property Tax Law, § 467:

An otherwise qualified senior citizen who is entitled to an aged exemption under section 467 of the Real Property Tax Law, does not lose such exemption by reserving a life estate to the property and granting to a son a remainder interest in the property.

Our opinion has been requested as to whether an exemption may be allowed on property owned by an otherwise qualified person 65 years of age where a son’s name is added to the deed.

Section 467 provides that the owner, or if the property is owned by more than one person, all of the owners (except in the case of spouses), must be 65 years of age or over when an application is filed. Furthermore, title to the property for which the partial exemption is claimed must have been vested in the owner or owners for at least five consecutive years prior to the date the application is filed.

          Thus, assuming the son became a recent owner of the property, an exemption would have to be denied on two grounds: First, because the son, an owner of the property, was under 65 years of age; second, because the creation of the new title resulted in a break of the chain of title and the property, held under the new title for a period of less than five years, does not satisfy the five year length of ownership requirement of the exemption statute.

The type of title that an applicant or applicants must have is an estate in fee or a life estate. Title to real property owned by more than one person may be held as a tenancy in common or a joint tenancy. A married couple may also hold title to property as tenants by the entirety.

Accordingly, if a tenancy in common or a joint tenancy was created when the son’s name was added to the deed, the son became an owner of the property and, for the reasons set forth above, an exemption may not be allowed on the property. However, if the mother reserved to herself a life estate and granted the son a remainder interest in the property, an exemption would properly be allowable on the property assuming the mother was otherwise qualified. It is well settled law that the holder of a life estate is deemed to be the owner of the property for all purposes, including taxation, whereas the rights of a remainderman with respect to ownership of the property do not ripen or come into being until the death of the life tenant.

March 29, 1972