NY Tax L § 255 (2021)
2021 New York Laws TAX - Tax Article 11 - Tax on Mortgages 255 - Supplemental Mortgages.

§  255.  Supplemental  mortgages.  1.  (a)  (i)  If  subsequent to the recording of a mortgage on which all taxes, if any, accrued  under  this article  have  been  paid,  a  supplemental  instrument  or  mortgage is recorded for the  purpose  of  correcting  or  perfecting  any  recorded mortgage,  or  pursuant  to  some  provision  or covenant therein, or an additional mortgage is recorded imposing the lien thereof upon  property not  originally  covered  by  or  not described in such recorded primary mortgage for the purpose of securing the principal indebtedness which is or under any  contingency  may  be  secured  by  such  recorded  primary mortgage, such additional instrument or mortgage shall not be subject to taxation  under  this article, except as otherwise provided in paragraph (b) of this subdivision, unless it creates or secures a new  or  further indebtedness  or  obligation  other  than  the principal indebtedness or obligation secured by or which under any contingency may be  secured  by the  recorded  primary  mortgage,  in  which  case,  a tax is imposed as provided by section two hundred and fifty-three of this article on  such new or further indebtedness or obligation.  (ii) Notwithstanding any provision to the contrary in subparagraph (i) of  this paragraph, the taxes imposed by or pursuant to the authority of this article shall apply to the recording of a  spreading  agreement  or additional  mortgage  which  imposes the lien thereof upon real property located in any city in the state having a population of one  million  or more  and  not  originally covered by or described in a recorded primary mortgage, unless the real property that becomes subject to the  lien  of such  spreading  agreement  or  additional  mortgage  is  owned  by  the mortgagor of the real property subject to  the  lien  of  such  recorded primary mortgage. If the commissioner of taxation and finance finds that transfers  of  one  or  both  of  such properties in connection with the recording of the spreading agreement or additional  mortgage  have  been undertaken  for  the  purpose  of avoiding or evading the application of this paragraph  rather  than  solely  for  an  independent  business  or financial  purpose,  such commissioner may disregard such transfers. For purposes of this subparagraph, there shall be  a  presumption  that  all transfers  of  one  or both of such properties to related parties within the twelve-month  period  preceding  the  recording  of  such  spreading agreement  or additional mortgage have been undertaken for tax avoidance or evasion purposes and such presumption may be rebutted only with clear and convincing evidence to the contrary.  For  this  purpose,  the  term "related" shall have the same meaning as in paragraph (b) of subdivision two  of  section  two  hundred fifty-three-a of this article except that references to "fifty percent" in such paragraph (b)  shall  be  read  as "twenty-five percent".  (b)  Notwithstanding any provision to the contrary in paragraph (a) of this subdivision, taxes are imposed at the rates specified in  paragraph (a)  of  subdivision  two  of  section  two  hundred fifty-three of this chapter for each one hundred dollars and each remaining  major  fraction thereof  of  principal  indebtedness  or  obligation secured by or which under any contingency may be secured by  a  supplemental  instrument  or additional  mortgage,  whether  or  not  there  is  any  new  or further indebtedness or obligation other  than  the  principal  indebtedness  or obligation  secured  by  the  recorded  primary  mortgage, where (i) the supplemental instrument or additional mortgage imposes  the  lien  of  a recorded  mortgage  upon  real  property  not  previously subject to the mortgage or where an additional mortgage upon such  additional  property is  recorded  as  additional  or substitute security for indebtedness or obligation already secured by a recorded mortgage and such  property  is situated  in  a county where the tax imposed by such paragraph (a) is in effect and (ii) the recorded  primary  mortgage  was  on  real  property  situated  in  a  county  which  had  suspended  the  tax imposed by such paragraph (a) and the mortgage was recorded without payment of such tax. The taxes imposed by this subdivision shall be distributed  pursuant  to section  two  hundred  sixty-one of this chapter in the same manner as a tax imposed by subdivision two of section  two  hundred  fifty-three  of this chapter.  (c)  The  taxes  imposed  by  this section shall be paid to the proper recording officer at the time the supplemental instrument or  additional mortgage is recorded.   2.  (a)  If,  at  the  time of recording such instrument or additional mortgage, any exemption is claimed under this section,  there  shall  be filed with the recording officer and preserved in his office a statement under  oath of the facts on which such claim for exemption is based. The determination of the recording officer upon the  question  of  exemption shall be reviewable by the tax commission.  (b)  If  an exemption is claimed under this section, at any time after such instrument or additional mortgage is recorded and tax  paid,  there shall  be  filed with the tax commission, as part of the application for refund a statement under oath of the  facts  on  which  such  claim  for exemption  is based. A copy of the order of refund of the tax commission shall likewise be filed with the recording officer and preserved in  his office.