If you are in the process of selling your home, you may be wondering, ‘do sellers pay property taxes at closing?’ Keep reading to find out.
Do Sellers Pay Property Taxes at Closing?
There is no official answer as to whether or not property taxes are paid at closing. In general, as long as the property is appraised and the seller does not have a delinquent tax or lien against the property, the seller is likely not responsible for paying property taxes at closing. Even if the taxes are late, the buyer can dispute the assessment and pay property taxes in the first several months of ownership, with proper documentation. If you have a delinquent tax or are being sued for a delinquent tax, you may be responsible for paying the tax while you are being sued.
Who Pays Property Taxes?
If you own a home (at least part of the mortgage) and sell it for more than you purchased, your new owners will take over the mortgage and assume the original lender’s responsibilities. They will need to pay property taxes each year. In the United States, you don’t necessarily need to pay taxes. If you own a home (at least part of the mortgage) and you are a renter or have lived in your home for over one year, you may not be required to pay property taxes. In some states like California, you are required to pay taxes. The information you find for your state is a great place to start for more information. Even if you’re not required to pay property taxes, it’s still good to have up-to-date records on the taxes owed.
What Happens If I Don’t Pay My Property Taxes?
It depends. If you paid the taxes on your home, you’ll receive a notice of lien and be required to pay the tax in full. If you pay the taxes on your home, you don’t need to worry about any of this, as long as you’ve paid your taxes when you bought your home. However, if you purchased a house with a mortgage that already includes property taxes, you need to pay those property taxes when you take possession of the home. However, there’s a catch. Property tax obligations may be deferred or deferred until the sale is complete. If you purchased your home with a mortgage, the local taxing authority will place a lien on your property and hold it until the taxes are fully paid.
Sellers can typically deduct real estate taxes on their state income tax returns, so you are generally paying less than if you were to have paid them before selling your home. Keep in mind, though, the real estate market has been depressed for several years and is expected to continue in a slump. Be sure to check out the current market value of your home and whether the property is selling at a loss.
Contact NH Home Buyers
Now that you know who pays property taxes at closing, it’s time to close on your home. Call the experts at NH Home Buyers. We buy houses in Hillsborough, New Hampshire, fast and in cash, so you don’t have to worry. Contact us today to get your fair, written, no-obligation offer, and you could have cash in hand for your home ASAP.