Understanding Tax Proration

Understanding Tax Proration

Property taxes are paid current when a property is sold.  Find out how to calculate tax proration at the close of escrow.   Closing costs for the sale of real property will include property tax proration.  The purpose of a proration in a sale escrow is to fairly divide property expenses – such as taxes and homeowner’s association dues (HOAs) – between the buyer and seller to ensure each party is only paying for the days which s/he actually owns the property.   THE TAX YEAR Unlike the calendar year, the tax year begins on July 1 and ends on...Read more