Back Taxes Owed On For-Sale Property
Added February 23, 2009 by Ilyce R. Glink and Samuel J. TamkinSummary: A buyer of a vacant lot learned that the sellers owe three years of back taxes on the property. If the back taxes are not paid before, or at, the closing, the buyer will become responsible for them. A real estate attorney can help this buyer ensure he is protected from having to pay the back taxes on this property.
Q. I made an offer on some vacant land and the sellers accepted. I just found out that the sellers owe back taxes on the land for the last three years. How can I get them to pay the taxes before I actually sign the closing documents? Am I going to be responsible for the back taxes if they don't pay them?
A. If the back taxes are not paid before, or at, the closing, you will be responsible for them.
Make sure your contract for purchase of the land specifies that all taxes are to be paid in full and that you will receive a credit at closing for any taxes for the current year that have not been billed but are for the period of time that the seller owned the property.
If the sellers are not willing to pay the taxes before, make sure you do not close until the closing company (either the title company or escrow company) cuts a check for the taxes out of the closing proceeds.
Your attorney should help you structure the contract so that you are protected. Please consult with him or her for more information.
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Additional Topics
(View All Topics)IRS back taxes credit foreclosure home buying income tax lawyer property property taxes quit claim deed real estate real estate advice real estate law taxes title
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