Judge Deals Crushing Blow to Mamdani’s Massive NYC Tax

New York City’s ambitious effort to tax second homes has run into an unexpected legal wall.

A Staten Island judge issued a temporary restraining order on Monday that freezes Mayor Zohran Mamdani’s pied-à-terre surcharge while a lawsuit proceeds.

The order requires the Department of Finance to take down a publicly released list of roughly 960,000 residential properties and bars the city from acting on notices already sent to about 17,000 owners.

A hearing is scheduled for August 31, leaving the future of the tax in limbo.

Three homeowners—Rachel O’Brien, Carmine Morano, and Simon Hedley—filed the suit in Richmond County Supreme Court, arguing the city’s process was flawed from the start.

The surcharge targets properties not used as primary residences, with thresholds of $5 million for one-, two-, and three-family homes and $1 million for condominiums and cooperatives.

Mayor Mamdani’s office has made clear it intends to fight the ruling.

“We disagree with today’s ruling, but we are confident in both the pied-à-terre surcharge and the City’s ability to implement it fairly and effectively,” spokesman Matt Rauschenbach said.

He described the tax as asking owners of high-value second homes to “contribute their fair share to the city they benefit from.”

Attorney Randy Mastro, representing the homeowners, welcomed the decision as a victory for due process.

“We are very gratified by the judge’s decision, which has vindicated the rights of hundreds of thousands of New York City homeowners who were subjected to a process they never should have been a part of in the first place,” Mastro said.

The tax took effect July 1 and quickly generated complaints from owners who say they were wrongly flagged despite living in their properties for years.

With the deadline to dispute notices now frozen, the outcome of the August 31 hearing could reshape how—or whether—the surcharge moves forward.