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Can anyone who knows alot about the flip tax please help me??
My grandmother passed away in October of 2006. She set up a trust for my mother to recieve the co-op when she passed away. After her death it was told to us by the co-op that all of the assests of my grandmother were placed in the trust but the co-op could not be passed on to my mother without a flip tax being imposed. The managing agent said the co-op had to be treated as a sale to be passed over to my mother from the estate of my grandmother over to my mother. This required my mother to pay a large sum(flip tax) with the sale of this apartment. Was this just???
My mother and I became owners of the apartment in January of 2007 and now are recieving word from the board that the flip tax is being waived as of March for those residents who set up a trust. I think this is totally unfair and would greatly appreciate it if anyone can email me with any pertinent informantion as to whether I can obtain any of my flip tax, legal fees or any monies back. I feel I was taken advantage of greatly? Would anyone advise me to hire a lawyer and if so can anyone recommend one in the NYC area?
PLease help me I am very desperate....
This is an outrage!!!!!
There is a flip tax if a shareholder sells, yes! But there should not be a flip tax for a stock certificate transfer to someone in the same family especially if it were willed to you as part as your grandmothers estate.
Hire an attorney at once!!! Any real estate attorney familiar in condo/coop. law will suffice.
Good luck and you should get your money returned. If not because if was right; then because they insitituted a "new rule" immediately after taking your money.
I would fight big time!!!!!!!
Let me know how you do!
Signed
Furious!!!!!!!!
Something is not right.
Call Dennis Greenstein, esq. 212-218-5520, former asst AG in NY.
Before you go on a major battle, you may want to approach the board with great diplomacy. I believe that when people communicate sicerely will get more than yelling or threatening to sue.
If the board reconsidered flip taxes for estates, two or three months after yours changed, it may mean that the board thought about the reasonableness of such a fee and decided to repeal at a later time the rule.
Again, a rule may be repealed by the board or changed without having to reconsider a rejection made two months ago under a rule and now considered acceptable. If you read the proprietary lease, you will find that a board may enact or change rules to preserve the interest of the co-op. This is similar to Uncle Sam; if a certain tax advantage was eliminated in a tax year, if you are late just for one day to take advantage of the old tax rule, well... YOU MISSED IT!
Since co-op boards are sometimes more benign than other institution, you may always act with diplomacy and obtain more because you and your mother are now part of the shareholder family. If not! Be happy that you got your grandmother's apartment w/o much of an investment except for the flip tax which will remain with the co-op for future work in your own co-op!
AdC
Whoa, whoa, whoa, people! Go back and look at the first reply, from AdC.
First, remember that your board is made up of people like you: non-experts who are trying to run a business so that it benefits you.
So if you immediately get into a legal battle, the board will have no other option than to get its lawyer involved. Perhaps you would rather have a conversation with them first, instead.
You could say, "I understand that you have changed / are considering changing the the flip tax rule so that it no longer applies to trust transfers. Of course, I just paid a flip tax in just such a situation. Can you tell me the reason you're going to change it now?"
Second, remember that, as AdC put it, you may have transfered your apartment a few months too soon to take advantage of the benefit. This happens all the time in life -- you're either a shade too early or a shade too late. It is not an outrage, it's the way the world works. So prepare to accept that, in this case, fortune didn't shine on you.
Third, understand that these trust inheritances are a legal maneuver to get around laws and regulations that apply to all of us. (One real estate lawyer told me that in the legal business, the trust inheritance is called Poor Man's Estate Planning.) So realize that all the trust does is transfer shares -- it does not allow you to live in the apartment or to sublet it, unless your board has specifically allowed that.
Fourth, before you get steamed about this, understand that as shareholders YOU are part owners of the business. If YOU don't want to pay in to support the business, then you are expecting your neighbors to shoulder YOUR financial obligation. That's not fair to them. If cooperative ownership is not your cup of tea, you should sell the apartment.
Finally, do talk with a lawyer if you wish, but do so to find out your rights and responsibilities under the proprietary lease (I assume you haven't read it -- almost no one does). Don't let the lawyer start sending letters until you A) understand what you may and may not do in a co-op, and B) before you have had a reasonable discussion with the board.
I hope this helps. You may e-mail me if you have other questions.
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get a lwyer on it and ask for buildoing records to see if any similar incidents ahve happendd in the past. this does not sound right since it is techincally not a sale (ie it was never put on the market) - probably just a reassignment of shares to a family member.
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