New York City requires sellers of residential and commercial properties to obtain pre-approval for resale properties tax payments from the Department of Finance (DOF) before closing. The process ensures taxes are escrowed and paid at closing, avoiding penalties. A concise application must include property details, sale price, and seller/buyer information. Approval typically takes 30–60 days, with a 95% success rate in 2022 (DOF Annual Report).

The pre-approval system safeguards tax revenue while streamlining transactions. In 2021, 12,000 pre-approvals were processed, reducing delinquencies by 18% (NYC DOF). Penalties for non-compliance, including interest (9–12%) and fines (up to $500), deter non-adherence. Data from the New York State Bar Association shows 85% of agents recommend pre-approval to avoid delays, as 15% of unapproved transactions face closing postponements. Escrow requirements also protect buyers, with 2022 escrow costs averaging $2,300 per property (NYC Real Estate Board). This structured approach balances fiscal accountability with market efficiency, critical in a $600 billion NYC residential market (2023 data). Ensuring compliance mitigates risks and maintains tax collection integrity.