Rollout of NYC’s Pied-a-Terre Tax Suffers Setback in Lawsuit

The rollout of New York’s pied-a-terre tax suffered a setback when a judge sided with homeowners who sued to delay the implementation of the levy, ordering the city to replace a list of of thousands of properties that it says are potentially subject to the tax on second homes and rescinding notices mailed to property owners in July.

New York State Supreme Court Justice Wayne Ozzi in Staten Island on Tuesday granted a request by the homeowners to force the city to take down a supplemental roll of more than 900,000 properties that could be subject to the tax and replace it with a more limited list. The case didn’t challenge the tax itself, instead taking aim at the way the city has begun implementing the levy.

The ruling may force the city back to square one on the implementation of the levy, a signature policy of Mayor Zohran Mamdani. The tax applies to single-family homes with market values of $5 million or more, and co-ops and condominiums worth at least $1 million.

“We’re gratified that the court has recognized we were right all along,” said Randy Mastro, a former deputy mayor in the Giuliani and Adams administrations, who filed the lawsuit. “Now the administration must go back and do what it should have done from the start: use all the information at its disposal to make an individualized ‘initial determination’ about who truly owes this surcharge before demanding that they pay it.”

Messages seeking comment from city officials weren’t immediately returned.

The case is O’Brien v the City of New York, 85217/2026, New York State Supreme Court, Richmond County.