New York’s Pied‑à‑Terre Tax Faces Constitutional Challenge

When Miami‑based Scott Golden and Stephanie Cohen closed the deal on their Upper West Side condo in July, they expected the usual closing costs and perhaps a modest property‑tax bill. What they didn’t anticipate was a sudden, 25‑fold jump in taxes – a nearly $49,000 surcharge that arrived after the sale was already finalized.

The shock‑inducing charge isn’t a one‑off. It’s part of New York State’s newly‑minted pied‑à‑terre tax, a levy aimed at luxury second homes but applied retroactively to anyone who owned a qualifying unit as of Jan. 5, 2026 – months before the law even took effect.

Golden, now 63, says the tax feels like a blunt instrument. “It’s blatantly unfair that they’re targeting and discriminating against out‑of‑staters,” he told the Post, noting that had he known about the tax, he would have sold the $6.55 million property much sooner.

He isn’t alone. The lawsuit, filed on Sept. 29 in New York’s Supreme Court, bundles together a handful of other homeowners and a historic Little Italy co‑op. Among them is Kent Barwick, a former head of the Landmarks Preservation Commission, and his wife June. Their Mott Street co‑op, valued at roughly $2.1 million, suddenly carries an $83,603 extra tax bill on top of ordinary property taxes – a total that pushes the annual cost over $108,000.

Barwick, 85, says the added burden is crushing for retirees on modest incomes. “We’re being asked to find an extra $80,000,” he said, “and we may have to sell the co‑op if we can’t.” The plaintiffs argue the tax violates both the U.S. Constitution’s Equal Protection Clause and New York’s own constitution by singling out non‑residents and imposing a retroactive financial penalty.

Governor Kathy Hochul and Mayor Zohran Mamdani originally championed the measure as a way to pull $500 million into the city’s budget, framing it as a tax on billionaire out‑of‑state investors. Critics, however, point out that the tax’s thresholds capture many middle‑class owners of second homes, not just the ultra‑wealthy.

Real estate industry leaders have rallied behind the lawsuit. Jim Whelan, president of the Real Estate Board of New York, says the tax is “misguided, unconstitutional, and unfair to the very people who live, work, and invest in New York.” The board is footing the legal bill, hoping the case will force a rethink of the policy’s design.

Mayor Mamdani, flanked by officials from the Parks Department and City Council, has signaled he will push ahead with the tax despite a recent court order that sent a related case back to the drawing board. The city has already appealed that decision, keeping the controversy alive as the Jan. 5 deadline for payment looms.

As the legal battle unfolds, the plaintiffs face a stark choice: find a way to cover the steep tax bill or relinquish their prized second homes. For many, the dispute isn’t just about dollars and cents; it’s about whether the state can reach back in time to levy a charge that feels, to them, like a punishment for simply owning a piece of New York real estate.