Q. If I sell my house 10 days after the quarterly real estate tax is due, does the buyer or seller pay the full or partial tax?
A. The payment of property tax is made right at the closing.
In most states, whoever owns the property when the taxes are due pays the tax for that quarter.
In New Jersey property taxes are typically due on Feb. 1, May 1, Aug. 1 and Nov. 1, said Matthew DeFelice, a certified financial planner with U.S. Financial Services in Fairfield.
He said at the closing, the property taxes are pro-rated.
“That means the buyer reimburses the seller for the property taxes that have already been paid for the period starting from the date of sale to the end of the tax quarter,” DeFelice said. “This charge will be listed as a line item on the settlement statement given to both the buyer and seller, and it will be part of the cash the buyer will need to have on hand to close on the property.”
If you escrow your taxes, the mortgage company will refund the seller the portion of the property taxes already paid, pro-rated from the date of the closing, DeFelice said.
The seller typically receives a check from the old mortgage company within a few weeks of the sale, he said.
Good luck with your sale.
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