Tenants' Amended Tax Returns May Put Income Below Deregulation

Landlord applied for high-rent/high-income deregulation of tenants' apartment in 2005. The DRA ruled for landlord based on Department of Taxation and Finance (DTF) records that matched tenants' information. These records showed that tenants' gross adjusted household income was $175,000 or more for 2003 and for 2004. Tenants appealed, claiming that they filed two amended tax returns in 2003. The first amended return listed income above $175,000. This return was sent back to tenants because it wasn't signed, and it was then resubmitted to DTF. But tenants submitted a second amended tax return in 2003 that listed income below $175,000. Tenants claimed that DTF matched the wrong return when DHCR requested matching information for tenants. The DHCR ruled for tenants and reopened the case. More information was needed to determine whether DTF gave the DHCR incorrect information and whether tenants' income therefore was below the deregulation threshold for 2003.

Nessen: DHCR Adm. Rev. Docket No. UH420023RT (1/18/07) [5-pg. doc.]