DRA Must Investigate Unverified Income Tax Data

Landlord applied for high-rent/high-income deregulation of rent-stabilized tenants' apartment in 2009. The DRA ruled against landlord after being unable to verify tenants' household income for 2007 and 2008. Landlord appealed, and the case was reopened. Tenants had stated that their net household income was below the deregulation threshold and had attached copies of their New York State income tax returns to their answer. But the NY State Department of Taxation and Finance (DTF) found no match for tenants or their children for the relevant tax years. Both landlord and tenants were given the chance to submit further information to the DHCR. The DHCR then made a second attempt to verify tax information with DTF, to no avail. Landlord argued that the DRA should have made further efforts to verify tenants' income. The DHCR agreed that, since tenants claimed that they had filed returns for the two years in question, the DRA should investigate further. Among other things, the DRA should require tenants to make follow-up inquiries to DTF concerning their tax returns.

165 West 91st Street Holdings, LLC: DHCR Adm. Rev. Docket No. AQ410028RO (10/9/13) [3-pg. doc.]