Tax Facts

  1. All property has an assessed value as of January 1 each year.
  2. The Fiscal year begins July 1 and ends June 30.
  3. Taxes are levied in March for the current fiscal year based on the value present on January 1 assessment date first preceding the commencement of the fiscal year.
  4. The taxes for any fiscal year are PAYABLE in the next fiscal year.
  5. Taxes are levied as one sum for a fiscal year but may be paid in two installments (there is no such thing as 1st half taxes, 2nd half taxes; payments, yes, but taxes, NO).

SO

 

 

 

As an ordinary practical matter, a seller will pay all taxes DUE in the current fiscal year and will, in addition, obligate himself to a pro-rata sum based on his beneficial possession of the property during the CURRENT fiscal year.

FOR EXAMPLE

1.  Property sells March 1, 2000

Seller pays all taxes DUE during fiscal 1999-2000 and gives a pro-rate for eight months possession during 1999-2000.  In other words, Seller pays all of Fiscal 1998-1999 taxes based on January 1, 1998 assessed value with delinquent payment dates of October 1, 1999 and April 1, 2000 and in addition gives a pro-rate based on 8/12 of current bill to compensate purchaser for sellers possession from July 1, 1999 through February 28, 2000.

2.  Property will transfer on August 1, 2000

Seller pays all taxes DUE during fiscal 2000-2001 and gives pro-rate for 1 month possession during fiscal 2000-2001.  In other words, Seller pays all of Fiscal 1999-2000 taxes based on January 1, 1999 assessed value with delinquent payment dates of October 1, 2000, April 1, 2001 and in addition gives a pro-rate based on 1/12 of current bill to compensate purchaser for sellers possession during July of 2000.