No Deregulation Where Tenant's Estate Filed Late Tax Return

Landlord applied in 2005 for high-rent/high-income deregulation of tenant's apartment. Tenant answered the notice of landlord's application. She said her household income was below $175,000 in 2004. She also said that her father, co-tenant in the apartment, died in 2005 and hadn't filed an income tax return for 2004. Later, tenant advised the DHCR that her father's estate filed a late tax return for 2005. The DRA ruled against landlord after confirming with the Department of Taxation and Finance (DTF) that tax returns were filed for both tenants and that their household income was less than $175,000 for both years in question. Landlord appealed, claiming that the DHCR should have further investigated tenants' combined income. The DHCR ruled against landlord. The DHCR was required only to seek a match with DTF data on whether tenants' combined adjusted gross income for the household was more than $175,000. The DTF did match the household tax records and confirmed that the income level was below the deregulation threshold.

Graceton Estates Inc.: DHCR Adm. Rev. Docket No. VB410058RO (5/9/07) [2-pg. doc.]