Check the Stock Certificate for Your Co-Op Apartment
New York co-op apartment owners prior to 1996 – If you and your spouse own a co-op apartment and purchased it before January 1, 1996, it would be wise to review the stock certificate. If the certificate has both of your names, but doesn’t actually specify “tenancy by the entirety,” or “joint tenant with right of survivorship,” you may want to have the stock certificate updated.
Prior to January 1, 1996, if you and your spouse had obtained cooperative stock certificates, and one of you now predeceases the other, the stock certificate does not pass to you automatically as a joint asset, i.e. it is not automatically a “tenancy by the entirety” and you don’t inherit it outright (as is the case with real property). In that event, your deceased spouse’s 50% share would pass to their estate and have to go through probate with an estate representative appointed by a court in order for you to transfer it. Children of the deceased would also have an interest in that estate as heirs at law, unless there was a will or trust that said otherwise.
The law changed on January 1, 1996. If you and your spouse acquired the stock jointly after January 1, 1996, the presumption is that you take the stock as joint tenants by the entirety if you are husband and wife, unless you specify otherwise in the document. As the surviving spouse, you acquire the stock by operation of law without the need for estate proceedings.
What is a Tenancy By the Entirety? A Tenancy By the Entirety is an undivided interest in real property held jointly by a married couple as husband and wife. Each spouse owns 100% of the real estate, and is protected from the debts and creditors of the other. Property acquired by a husband and wife in their names during marriage is presumed to be a Tenancy By the Entirety. In New York State, when one spouse passes away, the surviving spouse automatically becomes the owner by operation of law without the need for estate proceedings. While coop stock is not real property, as of January 1, 1996, married couples can acquire the stock as tenants by the entirety.
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Gabor & Marotta, LLC does not provide tax, legal, property or accounting advice by articles. This material has been prepared for informational purposes only and is not intended to provide, and should not be relied on for, tax, legal, property, or accounting advice.
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