I am a sponsor of a new construction condominium plan in Manhattan. I understand that the Governor’s executive order suspended the deadline to take advantage of the mortgage recording tax credit. Can you explain the credit, the executive order, and how the suspension works?
Answer
N.Y. Real Prop. Law §339-ee(2) provides that: “In the event the proceeds of a construction mortgage were applied to construction of a unit of a condominium submitted to the provisions of [the Condominium Act], or in the event that a unit submitted to the provisions of [the Condominium Act] was subject to a blanket mortgage whose proceeds were applied exclusively to payment of the construction mortgage or to capital expenditures or expenses for the development or operation of the condominium, or to purchase of land or buildings for the condominium provided that such purchase was no more than two years prior to the recording of the declaration of condominium, and a mortgage recording tax was duly paid on such construction or blanket mortgage in accordance with article eleven of the tax law, then, as each unit is first conveyed, there shall be allowed a credit against the mortgage recording taxes (except the special additional mortgage recording tax imposed by subdivision one-a of section two hundred fifty-three of the tax law) that would otherwise be payable on a purchase money mortgage, said credit to be in the amount resulting from the product of the purchaser’s pro rata percentage of interest in the common elements and the mortgage tax already paid on the construction or blanket mortgage. No credit shall be allowed under this subdivision (a) on account of the special additional mortgage recording tax imposed by subdivision one-a of section two hundred fifty-three of the tax law or (b) where the first condominium unit is sold more than two years after the construction or blanket mortgage was recorded.”
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