Question: I am an attorney for a sponsor on a project in Manhattan. I read that the tax law on grossing up of transfer taxes was amended this summer. Can you explain the change in the law as well as any disclosure requirements related to my client’s offering plan?
Answer: For readers unfamiliar with this area of practice, let me begin with what it means to “gross up” for purposes of real estate transfer taxes and why it is done. It should come as no surprise that the sale of a residential condominium unit or cooperative shares in New York City is a taxable event. Among the multitude of fees and costs paid at the closing table, one of the parties has to pay New York State Real Estate Transfer Tax (levied pursuant to Tax Law §1402), New York City Real Property Transfer Tax (imposed per N.Y.C. Admin Code §11-2102), and, on a purchase or sale with a consideration of $1 million or more, the so-called “Mansion Tax” (imposed pursuant to Tax Law §1402-a, with the rate imposed escalating on a progressive scale in accordance with Tax Law §1402-b).
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
