Though everything is open to negotiation during a real estate sale, real estate agents assure clients that there are a set of guidelines that most deals follow. These guidelines include explaining how the property taxes should be handled, and understanding how it works ahead of time will ensure you don’t have any unpleasant surprises at closing. Here’s a closer look at how property taxes are typically handled.

A Real Estate Agent’s Guide to Property Taxes & Sales

What’s Typically Expected

When selling a home, sellers are responsible for paying their property taxes up until the closing date. Buyers are responsible for these taxes on the closing date and afterward until they sell the home. Property taxes are paid ahead of time, and most property owners pay them every six months. When a sale occurs in the middle of this six-month period, the seller will need to be reimbursed for an appropriate portion of the taxes they paid ahead of time. When this is done, the taxing authority will have been paid in full by the seller, and the buyer will pay their portion of the six-month period to the seller so the seller doesn’t pay taxes they do not owe.

How to Handle Reimbursement

Your real estate agent can help you determine the proper reimbursement amount, which will then be listed on the final settlement statement. The total tax amount is divided by six to determine the monthly rate. That amount is then divided by 30 to determine the daily amount; it doesn’t matter how many days are actually in each month during the period. The number of days the buyer is responsible for is then calculated — they are responsible for the closing date itself as well — and then multiplied by the daily rate to determine the amount due.

The real estate purchase process is complex between the negotiations, strict regulations, and piles of paperwork. Top local REALTOR® Justyna Johnson – Edina Realty will use her experience and skills to guide you through the entire process with ease. She is a real estate agent who has been recognized as a 5-Star Premier Agent with Zillow®. Learn more about her online, and call (651) 501-2345 to discuss selling or buying a home. She also offers a TRUSTimate, which is a free online property report, to all her clients. Just text HOME to the number above for your report. You will receive no calls, spam, or sales communication — just the facts from your local top REALTOR. She is always there to serve you!