Introduction to Coop Will Writing Services
Cooperative (coop) housing is a type of housing where individuals jointly own shares of a corporation, trust, or limited liability company that owns real estate developed as housing. Cooperatives differ from condominiums in that residents do not own shares in one particular unit, but rather residents own shares in the overall cooperative, which owns all the real estate and improvements.
Given the communal nature of cooperative ownership, it is especially important for coop residents to have wills or estate plans to clearly specify how their shares will pass upon death. This is where coop will writing services can help cooperative owners properly plan their estates. In this article, we will discuss the key reasons cooperative owners benefit from using coop will writing services, the process of writing a coop will, special considerations for cooperative ownership, and tips for selecting a qualified coop wills attorney.
Reasons for Using Coop Will Writing Services
There are several important reasons why cooperative owners should work with specialized coop will writing services:
Properly bequeath shares: Coop shares are a unique asset unlike traditional homes, condos, or other real estate. Coop wills attorneys understand how to properly bequeath coop shares to beneficiaries in accordance with the coop’s bylaws and rules. Without a proper coop will, shares could be difficult for heirs to claim or sell.
Avoid dispute or delay: If shares passed without clear instruction, it could lead to confusion, delay, or potential disputes among family members as to who should rightfully inherit the shares. A valid coop will ensures smooth transfer of shares according to the owner’s wishes.
Comply with coop bylaws: Most coops have special provisions in their bylaws governing inheritance and transfer of shares. Coop attorneys are familiar with these rules and can structure the will accordingly. Failing to comply with bylaws could jeopardize the transfer.
Appoint an executor: A coop will allows designation of an executor who understands the responsibilities involved, such as certifying heirs meet residency criteria, paying maintenance fees, and potentially selling or renting the shares.
Tax planning opportunities: Coop wills attorneys can advise on potential tax implications of bequeathing coop shares and strategies to reduce taxes owed by heirs.
Provide alternate beneficiaries: In the event named beneficiaries cannot or do not want to take ownership, alternative provisions can direct where the shares should go instead of the coop having to get involved in probate.
The Coop Will Writing Process
When creating a coop will, the attorney will go through the following specialized steps:
Review coop documents: The attorney obtains copies of the coop’s bylaws, proprietary lease, shares certificates, and other relevant documents to fully understand the coop’s rules and ownership structure.
Discuss client’s family: The client provides input on family members, their relation to the client, dependency/health situations, where they live, etc. This helps determine who would be best suited and eligible to inherit.
Identify shares disposition: The will directs where exactly the shares (i.e. specific rooms/units) should go and names primary and contingent beneficiaries in order of priority.
Address ongoing obligations: Responsible parties are assigned to handle maintenance fees, selling shares if necessary, meeting residency rules on subletting or reselling, etc. after death.
Appoint executor: An appropriate executor, often a family member, is designated and given powers to handle administrative tasks. Professional executors may be used for larger or more complex estates.
Address tax considerations: Provisions help reduce estate taxes and allow tax basis step-up for any capital gains taxes owed if shares are sold later.
Sign and notarize the will: Typically 2-3 witnesses also sign for validity. Copies are safely stored and shared with named parties. The will can always be updated for any future life changes.
Special Coop Considerations in Wills
There are some special attributes of cooperative housing that shape certain aspects of a coop will:
Residency rules: Most coops limit residency only to the shares owner and their immediate family. Provisions ensure shares pass only to beneficiaries that meet residency criteria.
Share transfer fees: Bylaws may impose transfer fees when shares change hands, such as upon an owner’s death. Wills can instruct paying these fees from estate assets.
Right of first refusal: Many coops give existing shareholders the right to match any purchase offer on someone else’s shares before they can be sold externally. Wills respect these rules.
Maintenance obligations: The cooperative model entails shared costs for building maintenance. Estates typically remain responsible for covering these ongoing maintenance fees even after an owner passes.
Specified apartments: Unlike traditional private home ownership, coop shares represent a particular apartment unit. Wills specifically assign which shares/unit each beneficiary will receive.
Voting interests: Coop shares include voting interests in cooperative governance. Wills should address how such interests split among beneficiaries.
Choosing a Qualified Coop Wills Attorney
When selecting an attorney for coop estate planning needs, look for someone who:
Has experience drafting wills, trusts, estates for coop owners specifically
Understands the unique legal structures and ownership rules of cooperatives
Is familiar with various coop bylaws prevailing in your state/city
Maintains updated knowledge of constantly changing estate tax laws
Has a good reputation working with various coop boards as part of the estate settlement process
Provides clear communication and guidelines on pricing upfront
Offers convenient meeting locations and scheduling for consultations and revisions
Can also advise on related topics like powers of attorney, health directives, Medicaid planning
Belongs to reputable organizations like the American College of Trust and Estate Counsel (ACTEC)
With the assistance of an experienced coop wills attorney, cooperative owners can rest assured their shares will pass according to their intentions upon death and create the least disruption for their loved ones. Taking the time for proper estate planning tailored to coop ownership is highly recommended.
Andrew Stroud