False response to Chapter 91 request dooms tax appeal

In another loss for taxpayers, the New Jersey Tax Court granted a municipality’s request to dismiss a tax appeal on Chapter 91 grounds. N.J.S.A. 54:4-34, also known as “Chapter 91” permits the municipal tax assessor to request from owners of income producing property certain income and expense information. The failure to respond or respond accurately is grounds for the municipality to move to dismiss a tax appeal in the subsequent year. Usually Chapter 91 cases involve a claim by the municipality that the taxpayer failed to respond. In this case, Rasht, Inc. c/o Gasgo v. Township of Raritan, the Township claimed that the taxpayer filed a false response, and the Tax Court agreed.

Here, in response to a Chapter 91 request, the property owner indicated that the property was owner occupied and that the property did not generate income. During the subsequent tax appeal, the Township learned that the owner rents the subject property to a tenant. The owner alleged that the tenant was a related entity and considers the property to be owner occupied. The Township filed a motion to dismiss the tax appeal because of plaintiff’s false response to the Chapter 91 request.

The court found that a landlord-tenant relationship exists at the property. The court held that while the owner may consider the property to be “owner occupied,” it was not relieved of its obligation to provide a true account of the landlord-tenant relationship present at the property. The court dismissed the appeal.

This case is another reminder of the harsh consequences of Chapter 91. Property owners should take note that they must respond to such requests; respond timely and provide a complete response.

For more on Chapter 91 cases please see:

No Landlord-Tenant Relationship Means No Dismissal Under Chapter 91

Two More Taxpayers Victims of Chapter 91 “Litigation Gamesmanship”

To Wield Chapter 91 Sword to Dismiss Tax Appeals Towns Must Play by the Rules

Property Owner’s “False” Responses Lead to Dismissal of Tax Appeal

Property owner survives Verona’s “Chapter 91″ attack

Chapter 91 Strikes Another Taxpayer

Tax Court Denies Phillipsburg’s Chapter 91 Motion to Dismiss