On September 29, 2026, New York Supreme Court Justice Wayne M. Ozzi invalidated key aspects of New York City’s rollout of the pied-à-terre tax finding that the Department of Finance’s initial procedures “unfairly shifted the burden to thousands of homeowners to prove their basic residency.”
In O’Brien v. City of New York, the court ordered the New York City Department of Finance (“DOF”) to cancel previously mailed surcharge notices, remove the existing Supplemental Roll, and change the manner in which it determines whether a property is being used as a primary residence. The ruling can be found HERE.
Justice Ozzi ordered that:
• all previously mailed notices be cancelled;
• new notices be mailed only after an individualized initial determination;
• the notice identify the basis for DOF’s conclusion that the property is not a primary residence;
• the notice explain applicable valuation information and the owner’s right to challenge the determination; and
• the notice explain the potential penalty applicable to negligently or improperly submitted documentation.
What This Means for Property Owners
As we noted in our August 11, 2026, client alert available HERE, the case does not question the validity of the pied-à-terre tax itself. Instead, the ruling invalidates significant aspects of New York City’s initial implementation of the law.
So Why Is October 6 Still Showing as the Deadline?
New York City has already appealed the decision. Enforcement of yesterday’s decision is stayed pending the result of the appeal and the DOF continues to collect non-primary residency surcharge exemption applications.
Is The Law Constitutional?
While O’Brien v. City of New York addresses only the rollout of the tax, two actions filed this week questioned the constitutionality of the law. Those actions are:
• Robert Friedman et al v. The State of New York (complaint available HERE)
• Wilbur Louis Ross Jr. et al v. State of New York (complaint available HERE)
What Property Owners Should Do Now?
Until DOF or an appellate court expressly states otherwise, owners who received a surcharge notice should continue to treat October 6 as an operative deadline in order to preserve their rights.
In practical terms, an owner should not rely solely on the September 29 ruling as a reason to allow the filing deadline to pass.
At the same time, the September 29 decision may substantially alter the process going forward, including whether previously issued notices remain enforceable and what DOF must do before issuing replacement notices.
The foregoing is not intended to be comprehensive nor constitute legal advice. If you would like to discuss your specific circumstances or would like more information, feel free to contact us at (212) 625-8505.