Property taxes are $5,475 per year. A property closes on March 20. Using a 365-day year and the day of closing belonging to the buyer, how many days of taxes does the seller owe?
Correct Answer
C) 78
The seller owns January 1 through March 19 (day of closing belongs to the buyer). January = 31 days, February = 28 days, March 1-19 = 19 days. Total = 31 + 28 + 19 = 78 days.
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Related Topics & Key Terms
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Related Concepts
The capitalization rate (Cap Rate) is the rate of return on a real estate investment based on its expected income.
Commission splits refer to the division of the total real estate commission among the listing and selling brokerages, and then between each broker and their respective agents. Commission rates and splits are always negotiable.
Determining ownership days involves calculating the number of days each party (buyer and seller) owned the property during the relevant period (usually a year). This calculation is crucial for accurate proration.
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