Patricia inherits her grandmother's cooperative apartment in the Bronx. The building's proprietary lease contains a 'flip tax' provision. What is the purpose of this flip tax in New York cooperatives?
Correct Answer
C) To generate revenue for the cooperative corporation when shares are sold
A flip tax in New York cooperatives is a fee paid to the cooperative corporation when shares are sold. This provides revenue for the corporation's reserves, capital improvements, or operating expenses, while also potentially moderating speculation and frequent resales.
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