The painting, called "Portrait of a Man," was recovered in part by the New York Department of Financial Services’ Holocaust Claims Processing Office, which has helped to return $171M in assets to relatives of holocaust victims.
"While the terrible damage caused by Nazi persecution can never be repaired, we hope that the recovery of this painting will deliver at least some small measure of justice," department Superintendent Benjamin Lawsky said at a ceremony at the Museum of Jewish Heritage in Manhattan.
"Portrait of a Man," which features a seated bearded man wearing a red and black ensemble, was seized during a Nazi raid of the home of August Liebmann Mayer, Lawsky's office said.
Facing growing anti-Semitism in his country, Mayer resigned from his jobs at the University of Munich and the Bavarian State Paintings Collection. He was arrested in March 1933, and some of his property was seized. Two years later, he fled to France.
However, after the Germans occupied Paris, the Nazis raided his home there and took his art collection before deporting him to Auschwitz, where he was executed on March 12, 1944, Lawsky's office said. Some of the belongings were confiscated by German air force commander Hermann Goering.
Some pieces from Mayer's art collection were returned to France after the war, including "Portrait of a Man," which was last displayed at the Louvre Museum in Paris.
With the aid of the French government, and attorneys for Mayer's daughter, his lone surviving relative, the painting was returned, Lawsky's office said.
The daughter, who was not identified, released a statement on Tuesday.
"It is never too late to recognize the fate of those we have lost during the years of Nazi terror," it said. "My late father was a most distinguished art historian and a great art lover and I am glad that after more than seventy years, justice is finally being served."