Escrow & Title

An Iowa property closing has a prorated credit for property taxes. The closing is June 30. Annual taxes are $4,800. How much does the seller owe the buyer (use 360-day year)?

A$2,000
B$2,400✓ Correct
C$2,800
D$3,200

Explanation

6 months (Jan–June) = $4,800 × (6/12) = $2,400. Seller owes buyer $2,400 for the first half of the year.

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