DHCR Accepts Tenant’s Proof of Income Years After Deregulation Application Filed

Landlord applied in 2010 for high-rent/high-income deregulation of tenant’s rent-stabilized apartment. The DRA ruled against landlord in 2012, after the State Department of Taxation and Finance (DTF) was unable to match tax return information for tenant for either 2008 or 2009. Landlord appealed, and the DHCR reopened the case in 2013 for further processing. Again DTF was unable to make a tax return match for tenant although tenant claimed he had filed. Eventually, in 2015, DTF made the match. The DRA ruled against landlord because tax information showed that tenant’s household income was $175,000 or less during both 2008 and 2009.

Landlord appealed and lost. Landlord argued that tenant’s failure to file tax returns for years warranted deregulation of the apartment because tenant showed no good cause for his delay and should have been defaulted by the DHCR. But tenant responded to all of the DHCR’s notices in this case, and landlord didn’t challenge tenant’s income information. The DHCR also had no authority to investigate tenant’s income information beyond the DTF tax match.

254 PAS Property LLC: DHCR Adm. Rev. Docket No. DO410003RO (8/19/15) [7-pg. doc.]