Real Estate Math

Annual property taxes are $4,200. If the closing is July 1 and taxes are paid in arrears on a 365-day year, how much does the seller owe the buyer at closing (assuming closing occurs on that day and the buyer owns the rest of the year)?

A$1,050
B$2,100
C$3,150
D$4,200✓ Correct

Explanation

Jan 1 to June 30 = 181 days seller owned property. Daily tax = $4,200 ÷ 365 ≈ $11.

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