We’ve all heard of split-level houses, but what about split-ownership houses? Involuntary split-ownership. That’s the position a Connecticuter /New Yorker finds herself in, thanks to a property tax flub by her bank.
The woman, whose property sits on the New York/Connecticut state line, had 40 percent of her half-acre property essentially annexed by her neighbor, who bought it at a foreclosure auction, when her bank failed to pay the property taxes on the New York side of her property for 7 years.
Given that property taxes are paid and collected at the county or municipal level, paying property taxes to two separate taxing jurisdictions is not as uncommon of a problem as might be supposed. Properties straddling state borders are less common, however, and having your neighbor buy the foreclosed half of your property is less common still.
A Delaware assessor, in a 1994 Philadelphia Inquirer article, said there were about 15 to 20 houses straddling the Delaware-Pennsylvania border at the time. According to a county budget director who was quoted in the article, there is some state legislation that determines where real property is taxed based on “where you sleep, where the bedroom is.”
Real property in both New York and Connecticut is taxed in the jurisdiction in which it is located, so the woman’s bank or loan-service firm had the responsibility to pay property taxes in both jurisdictions.
The lesson for anybody with property straddling two taxing jurisdictions: If you don’t want an unexpected roommate, make sure your bank knows how to pay taxes.
Continue the conversation on Bloomberg BNA’s State Tax Group’s LinkedIn page: Is there an easier way to administer property taxes for properties that straddle state borders?
Take a free trial to Premier State Tax Library, a comprehensive research service that delivers deep, unique analysis, and time-saving practice tools to help practitioners make well-informed decisions.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)