TRR photo by David Hulse Though not yet sworn to her District 4 seat, apointee Joann MacKinnon has recently been attending legislative functions at the government center.

County probes tax loopholes

By DAVID HULSE

MONTICELLO — Sullivan County Legislator Leni Binder (D-7) has sent local assessors a “heads-up” on a possible route to reducing the number not-for-profit (NFP) tax-exempt properties on town tax rolls.

Binder’s memo points out that NFPs must file with both the state and federal government to complete tax-exempt positions.

The state Department of State provides the status based on a mission statement in the entity’s application for incorporation.

The federal tax-exempt status, for income taxes, requires annual filing of a form 990, which also lists the mission and other information.

The catch, Binder says, is that when these NFPs expand, services sometimes report changes on the federal forms without updating their state corporate forms. When that happens, the new activity, program, facility or land acquisition is not tax exempt.

All this information is subject to Freedom of Information requests.

County Attorney Ira Cohen said that a NFP could file to amend its mission statement after a discrepancy in state and federal filings was pointed out. But Cohen noted that there are “fairly stringent” penalties under state law for allowing the discrepancy, which could force the NFP to re-apply for incorporation, from scratch.

Cohen said any actions resulting from these discrepancies would have to be initiated by the towns, but he said the county would support town efforts.

There is currently some $908 million in property tax exemptions granted in Sullivan County, amounting to more than 19 percent of the county’s $4.75 billion tax base.