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Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 3364
Experience:  18+ years of experience in tax preparation; 25+ years of experience as a real estate/corporate paralegal.
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How can I get the previous owner of my new home to pay s

Customer Question

How can I get the previous owner of my new home to pay his share of county taxes? The yearly statement arrived AFTER our closing, the home is second home to both of us therefore taxes are $3300 for year of 2015, I purchased Sept. of 2015.?????
Submitted: 1 year ago.
Category: Tax
Expert:  Lev replied 1 year ago.

Generally - a new owner is responsible for all real estate taxes AFTER the sale closed.

The seller is NOT responsible for real estate taxes.
However - on HUD1 statement - normally the buyer is credited by seller's portion of real estate taxes prorated by the number of days the property was owned during the year.

If you have HUD1 statement handy - we may review it together.

Customer: replied 1 year ago.
We both signed a tax agreement from the state of South Carolina that states: That purchaser and seller agree to pay, each to the other any adjustments which may be necessary to effect a property and exact proration of the actual amount due as set forth in the tax receipt
Expert:  Lev replied 1 year ago.

If you have such agreement - and taxes were NOT prorated on HUD1 - then - you may simply communicate the seller and ask to pay his share.

But otherwise - as a current owner - from prospective of tax authorities - you are the only responsible.

Customer: replied 1 year ago.
Thank you! HE will not pay. I appreciate your effort Good Bye
Expert:  Lev replied 1 year ago.

Unfortunately - that is an agreement between parties - and that would be a civil matter...

Expert:  Lev replied 1 year ago.

If you think about having taxing authorities to come after the seller - that will not going to happen...

They will simply put a lien on the property...
As no payment would be a violation of your sale contract - you may sue the other party for damages - obtain judgement - and start collection.
If parties do not agree on terms of previously signed agreement - that would be the only way to resolve the situation.

Expert:  Barbara replied 1 year ago.

Different expert here - my name is ***** ***** please allow me to provide you with additional information you will find helpful.

You may have recourse against the title company/closing agent who handled the transaction. It is their responsibility to prorate the current year's taxes between the buyer and seller EVEN THOUGH the tax bill was not available until after the closing. The common procedure is to take the previous year's tax amount, add a percentage common to your area to that amount and prorate accordingly between the buyer and seller. This way when the tax bill is issued, the title company will have the seller's prorated share in its escrow account to pay the seller's portion, and you, as the buyer, will pay your portion.

My best advice would be to contact the title company/closing agent who handled the transaction as soon as possible.

Please let me know if I can assist you further with this.

Thank you and Happy New Year,

Barb