Appeals court lets NYC keep rolling out its pied-à-terre tax

What happened

A state appeals court ruled on Wednesday, 11/04/2026, that New York City can keep rolling out its pied-à-terre tax. The Daily News identified the court as the Appellate Division, Second Department. It reversed a September ruling by Staten Island Supreme Court Justice Wayne Ozzi, who had found the city mishandled the program's launch and must redo it. The appeals court dismissed the suit. 6sqft reported the ruling on 11/05/2026.

The suit was filed in early August by a group of homeowners represented by attorney Randy Mastro. It challenged how the tax was rolled out, not the tax itself. Some owners with only one city residence got notices saying they might owe the surcharge. Confusion grew when the Department of Finance published a list of properties as state law requires. 6sqft put the list at nearly one million properties. Commercial Observer said about 900,000. The Daily News reported that the plaintiffs later learned they were exempt but kept suing. The appeals court found they lacked standing because they showed no concrete injury. It called the confusion they described "too generalized, tenuous, and ephemeral."

Sources describe the tax's scope slightly differently. 6sqft said it covers secondary one- to three-family homes valued at more than $5 million and secondary condos and co-ops valued at $1 million or more. Commercial Observer said single-family homes worth $5 million or more and co-ops and condos worth at least $1 million. Commercial Observer reported that Gov. Kathy Hochul signed the law in May. Officials say the tax could raise up to $500 million a year. In a May report, City Comptroller Mark Levine estimated $340 million to $380 million, citing exclusions for rental units and "behavioral responses."

Two other lawsuits in Suffolk County still challenge whether the tax is constitutional. One was filed by Stephen Wynn and by Wilbur Ross and Hilary Geary Ross. The other was filed by the corporation that owns The Montclair co-op on the Upper East Side and several homeowners, and it is backed by the Real Estate Board of New York. Commercial Observer reported that those cases proceed in December. Mastro said it was unclear whether his clients would appeal. Mayor Zohran Mamdani said the city will keep defending the law.