NYC Affordability

Despite the name, a flip tax isn’t a government tax at all — it’s a fee the co-op corporation itself charges on resale, written into the building’s proprietary lease. Most buildings set it between 1% and 3% of the sale price, seller-paid, though the exact structure (percentage of sale price vs. percentage of profit vs. flat per-share amount) varies building to building. Income-restricted HDFC co-ops can charge dramatically more — commonly around 30% of the seller’s profit, and at some buildings as much as 70% of the total sale price — since a large flip tax is one of the mechanisms that funds the building and discourages flipping for profit.

Worked example

A standard co-op selling for $800,000 with a 2% flip tax owes $16,000 at closing, deducted from the seller’s proceeds. Condos don’t have flip taxes at all — it’s one of the few costs unique to the co-op structure. See the flip tax guide for how HDFC buildings differ, or estimate your own sale proceeds including flip tax on the Sale Net Proceeds Calculator.