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UPDATE ON PREPAYMENT OF 2018 VILLAGE TAX

December 27, 2017, 11:45AM

Dear Residents and Neighbors:

The recently enacted Federal tax bill amends provisions of the U.S. tax code that have been in place for many years, with major effects on New York State. As many of you know, probably the most significant negative change for Larchmont residents is that, beginning with the 2018 tax year, there will be a $10,000 limitation on Federal income tax deductions for State and Local Taxes (SALT).

There has been much discussion as to whether local property taxes due in 2018 could be prepaid in 2017, but such prepayment in New York State was not allowed.  However, on Friday, December 22, 2017, Governor Andrew Cuomo issued an Executive Order allowing for the prepayment of local taxes in certain circumstances.

Many residents of Larchmont have asked – does the Governor’s Executive Order apply to Larchmont, and can the Village accept prepayment of taxes for Village tax bills that are normally issued at the end of May each year?

In order to address the community’s concern regarding prepayment of the Village of Larchmont’s 2018 real property taxes, we have conferred with the NYS Office of the Comptroller, NYS Department of Taxation and Finance, the Governor’s Representative for the Lower Hudson Valley Region, State and County legislative representatives, the New York Conference of Mayors (NYCOM), other villages and towns in Westchester County and the Village legal counsel.

After consultation with all parties, it is clear that:

  1. Since the Governor’s Executive Order applies explicitly only to counties and towns, and not to villages, the current State law prohibiting villages from accepting prepayment remains in force.

  1. Even if the Executive Order had included villages in a prepayment scenario, it still requires that municipalities have an approved budget in place for the upcoming fiscal year in order to issue a tax warrant and collect the taxes related to it.  As with most villages, our next budget year doesn’t begin until June 1, 2018 (with approval normally taking place in late April), and it is therefore impossible for the Village Board to approve that budget by the end of this week. The required process for the preparation and adoption of a Village budget, including noticed public hearings, has not been waived by this Executive Order.

I have discussed all aspects of this situation with the other members of the Board of Trustees. We tried to find a way for the Village of Larchmont to accept prepayments, without exposing either residents or the Village to potential liabilities. However, upon advice of counsel and with the guidance and commentary provided by all consulted agencies, the unfortunate conclusion was that the Executive Order did not provide a legal way for the Village to issue an expedited tax warrant.

Further confirmation of this decision was received today from NYCOM and Alphonso David, Counsel to Governor Cuomo:

 “that the Executive Order…

1) does not apply to villages with June 1 fiscal years,

And,

 2) simply accelerates the process of issuing a tax warrant but does not eliminate that process or any of the steps that come before it, including the adoption of the budget.”

Therefore, the Village of Larchmont is not allowed to accept prepayments or partial payments of 2018 Village property tax.

Sincerely,

Lorraine Walsh

Mayor, Village of Larchmont

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*Please be aware that the Town of Mamaroneck is accepting partial payments of 2018 Town of Mamaroneck and County taxes. Village of Larchmont residents should read this announcement for instructions on how to prepay your Town and County tax bill:

Town of Mamaroneck Instructions for Prepayment of 2018 Taxes

As always, the second installment of your 2017/2018 School tax bill (due January 31, 2018) can be paid in December. This payment is also made to the Town of Mamaroneck. This payment cannot be combined with your Town/County tax payment.