A Florida closing occurs on July 1 in a nonleap year. Use a 365-day year, assume taxes are paid in arrears, and assign the day of closing to the buyer. If the annual tax estimate is $3,600, what is the seller's tax debit?
Correct Answer
A) $1,785.21
Using the stated 365-day convention and buyer-day closing rule, the seller owes accrued taxes for 181 days. Daily tax times seller days equals $1,785.21.
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Previous Question
A Florida closing occurs on June 15. Use a 360-day year, 30-day months, assume property taxes are paid in arrears, and assign the day of closing to the seller. If estimated annual property taxes are $3,240, what seller debit for taxes is used?
Next Question
A Florida closing occurs on May 1. Use a 360-day year, 30-day months, assume property taxes are paid in arrears, and assign the day of closing to the buyer. If annual taxes are estimated at $3,960, what buyer credit corresponds to the seller's accrued tax debit?