What is the typical flip tax in New York City? NYC Flip Tax FAQ: https://www.hauseit.com/flip-tax-nyc/
If you are considering selling an apartment, you've probably heard that most co-ops have an additional closing cost for sellers called a flip tax. Both co-ops and condos can have flip taxes, however it's less common for a condo building to charge a flip tax.
So, what is a flip tax in New York City real estate?
A flip tax is a transfer fee charged by a co-op (or condo) on the sale or transfer of an apartment. The flip tax varies by building and is typically documented in its proprietary lease and by-laws. Flip taxes are usually paid by sellers, although the sale contract will specify whether the buyer or seller has agreed to pay the flip tax.
What's the typical real estate commission in NYC? https://www.hauseit.com/whats-typical-real-estate-commission-in-nyc/
Thanks to New York City's average 6% real estate commission, closing costs for sellers are sky high and can often exceed 8% of the sale price.
Although you cannot avoid paying a flip tax if your building charges one, there are ways for you to significantly reduce or eliminate the traditional 6% real estate commission when selling.
You can save up to six percent in commission by listing For Sale by Owner through Hauseit's agent-assisted Flat Fee RLS listing service. If you don't have time to sell FSBO, consider listing with a full-service, REBNY member listing agent through Hauseit for just 1% commission.
How to sell For Sale by Owner in NYC: https://www.hauseit.com/how-to-sell-for-sale-by-owner-in-nyc/
Sell in NYC with a full-service agent for just 1%: https://www.hauseit.com/agent-managed-listing/
How much is the average flip tax in New York City?
The average flip tax in New York City is 1-3% of the sale price. Flip taxes vary by building and can be structured in any of the following ways:
Percentage of the gross sale price Set dollar amount per co-op share owned Flat-fee dollar amount Percentage of sale profits
Can a co-op or condo in New York City change its flip tax?
Yes. A co-op or condo can change its flip tax by amending the proprietary-lease and building by-laws. Any change to the flip tax would require approval from a majority of the shareholders.
Are real estate flip taxes in New York City tax deductible?
Yes. You can usually reduce your taxable capital gains as a seller by subtracting the flip tax as an additional cost of the sale (alongside broker commissions, for example). We suggest you consult your attorney and tax professional for specific advice.
Are flip taxes payable on transfers to family members?
Not usually. Most co-ops will waive the flip tax if you are transferring your apartment to a spouse, permanent companion, children, or immediate family.
For more New York City Real Estate insider tips and tricks, visit https://www.hauseit.com
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