Q: How can a building be rented by one person and the land taxes be in another persons name? NYState?

A: A renter usually would not pay property taxes but would pay rent unless a commercial lease states otherwise. Separately, sometimes one person or entity can own land, and another person owns a building that leases the land from the landowner. In that case, the landowner could still be the person paying the property taxes.

A: Usually, this will occur with a Net Lease. The fee owner remains responsible unless the lessee agrees to become the party subject to local property tax.

A: In New York State, you can arrange for one person to rent a building while another holds the land taxes by setting up a ground lease. This legal agreement allows the landowner to lease the land to a tenant who then owns or rents the building on that land. The lease terms will specify who is responsible for paying property taxes related to the land and the building.

Another approach is to establish separate ownership of the land and the structure. The landowner remains responsible for land taxes, while the tenant or another party handles taxes for the building itself. Clear contracts are essential to outline each party’s responsibilities and avoid any misunderstandings.

To make sure everything is handled correctly, it’s wise to work with a real estate attorney or a knowledgeable professional. They can help draft agreements that comply with New York State laws and ensure both parties are protected. This setup can provide flexibility for both the landowner and the tenant, allowing each to manage their financial obligations effectively.