Question

Sally is buying a home and the closing date is set for april 20th. the annual property taxes are $1,234.00 and have not been paid yet. using actual days, how much will the buyer be credited and the seller be debited

Answer 1

Answer:

Sally (the buyer) should pay $865.58 and the seller should pay $368.42.

Explanation:

First we must determine property taxes per day = $1,234 / 365 = $3.38 per day

The seller is responsible for the property taxes until the closing date = 31 days for January + 28 days for February + 31 days for March + 19 days for April = 109 days x $3.38 per day = $368.42

Sally would be responsible for the remaining taxes = $1,234 - $368.42 = $865.58