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Volume 10 - Opinions of Counsel SBRPS No. 39

Opinions of Counsel index

Correction of errors (refund) (parcel listed in wrong school district) - Real Property Tax Law, § 556:

Where an administrative refund of taxes is granted for one, two or three years because property was erroneously listed as being in School District A, the property may be billed for the same number of years in School District B where it is actually located.

Our opinion has been requested concerning an administrative refund of taxes (Real Property Tax Law, § 556). It has been determined that certain property was erroneously listed on the assessment roll as being included within School District A; it is actually located within School District B. The question asked is who may seek a refund of taxes and how omitted taxes are to be computed.

The administrative correction of errors provisions (RPTL, Art. 5, title 3) pertain to “clerical errors,” “errors in essential fact,” and “unlawful entries” as defined in section 550 of the RPTL. Applicable to the facts here, section 550(7)(b) defines an “unlawful entry” as, “an entry on an assessment roll or a tax roll, or both, of the assessed valuation of real property which is entirely outside the boundaries of the assessing unit, the school district or the special district in which the real property is designated as being located. . . .”

To seek a refund of taxes paid where the taxes are attributable to a correctable error, it is the person who has paid the tax who must file an application for a refund (i.e., RP-556) with the county director of real property tax services (RPTL, §556(2)). There is a special provision applicable to refunds based upon this type of error: section 556(1)(b), which provides:

(b) For each year for which a refund is granted pursuant to the provisions of this section by reason of the existence of an unlawful entry as defined by [§ 550(7)(b)] of this title, the assessor of the assessing unit in which the subject real property is actually located, but has been omitted from the assessment and tax rolls of such assessing unit, or a school district or special districts located therein, shall have the authority to enter such real property on the current assessment roll in accordance with the provisions of [§ 551] of this title, notwithstanding any time limitation contained in such section. {1}

Consequently, if a taxpayer receives a refund of three years of taxes {2} erroneously paid to School District A, where the taxpayer’s property is not located, he or she may be charged with three years of taxes which should have been paid to School District B, where the property is located.

As indicated above, the procedure outlined in section 551 of the RPTL is to be used regarding the omitted tax due School District B. Section 551(2) provides, “Real property assessed pursuant to this section shall be taxed at the tax rate or tax rates for the preceding year. The amount of tax or taxes levied pursuant to this section shall be deducted from the aggregate amount of taxes to be levied for the current year.” In this case, then, if taxes are to be paid to School District B for its 1994-95, 1995-96 and 1996-97 school years, the assessments and tax rates applicable to the parcel in question for those years should be used to calculate an aggregate tax bill. That amount will then be deducted from the amount which would otherwise need to be raised through taxation on all property for the 1997-98 school year.

May 2, 1997

{1}  Section 551 generally provides for the entry on the tentative assessment roll of omissions only “from the assessment roll of the preceding year.”

{2}  Refunds for unlawful entries may be filed for up to three years following the annexation of the tax warrant where the error occurred (RPTL, § 556(1)(a)).