A sale transaction closes on April 1, the ninety-first day of the tax year. The day of closing belongs to the seller. Real estat

Question

3 years ago

11

A sale transaction closes on April 1, the ninety-first day of the tax year. The day of closing belongs to the seller. Real estat

e taxes for the year, not yet billed, are expected to be $3,150.
According to the 365-day method, what is the seller's share of the tax bill?

Business

1 answer:

zysi [14] · Answer 1 · 2022-01-27T13:33:41+03:00

Answer:

$785.34

Explanation:

The computation of the seller's share of the tax bill is shown below:

= Expected estate taxes for the year × number of days of the tax year ÷ total number of days in a year

= $31,50 × 91 days ÷ 365 days

= $785.34

We simply applied the proportionate method so that the approximate value could be arrived by taking all the information which is mentioned in the question.