From Sishodia PLLC – What is a Flip Tax? dives into the complexities of co-op ownership in New York City and how flip taxes impact buyers and sellers alike. This episode breaks down the nuances of buying shares in a co-op rather than traditional property ownership, and highlights key legal and financial considerations that can affect your bottom line when entering or exiting a co-op property.
We explore the origins and purpose of the flip tax—originally introduced during the co-op conversion wave of the 1980s—as a way to maintain a building’s capital without burdening all residents. Real estate attorneys Natalia A. Sishodia and Beatrice Raccanello provide insight into how flip taxes help fund building reserves and discourage rapid resales, while also explaining how rates vary from building to building and can be calculated in multiple ways, including a percentage of sale price or a flat fee.
Listeners will also learn how flip taxes are negotiated, who typically pays them, and how they influence closing costs in NYC’s competitive real estate market. We also unpack how flip taxes, while not deductible as taxes, can reduce capital gains and why it's essential to factor them into your sale or purchase strategy. Whether you're a seasoned homeowner or a first-time buyer, understanding this key cost is crucial to financial planning in New York City real estate.
Tune in as we clarify misconceptions about co-op living, from strict board approvals to financial benefits like the Cooperative and Condominium Tax Abatement. With guidance from the seasoned legal team at Sishodia PLLC, this episode is your go-to resource for navigating the intricacies of flip taxes and co-op transactions in one of the world’s most complex real estate markets.
Sishodia PLLC
600 3rd Ave 2nd floor, New York, NY 10016, United States
(833) 616-4646
https://www.google.com/maps?cid=12450537318741950980
