The SCR310 residential resale contract addresses property taxes in Section #22 Adjustments:
22. ADJUSTMENTS: Buyer and Seller agree to settle or prorate, annually or as appropriate; as of Closing Date: (A) utilities and waste fees issued after Closing which include service for time Property was owned/occupied by Seller (B) real estate taxes and owner association fees/assessments for the calendar year of Closing (C) any rents, deposits, fees associated with leasing (D) insurance, EMS service, fuel/consumables, and assessments. Closing Attorney shall make tax proration based on the available tax information deemed reliable by the Closing Attorney. Should the tax or tax estimate or proration later become inaccurate or change, Buyer and Seller shall make any financial adjustments between themselves once accurate tax information is available and Buyer takes timely reasonable steps to minimize taxes. This section survives Closing. Buyer is solely responsible for timely and reasonably minimizing the Buyer’s taxes and obtaining tax minimization procedural information including related legal counsel and financial counsel. Special assessments approved prior to Closing shall be the responsibility of the Seller. Special Assessments approved after Closing shall be the responsibility of the Buyer.
The closing attorney decides what is the most reliable property tax information for adjusting/prorating property taxes per the SCR310 (e.g., current property tax bill, anticipated property tax bill, past property tax bill, evaluating the tax assessor’s history and procedures, evaluating/counseling the sellers, evaluating/counseling the buyers, evaluating the property, some assessors may provide an estimated property tax bill).
"Closing Attorney shall make tax proration based on the available tax information deemed reliable by the Closing Attorney. "
The parties agree to settle up later if the property tax proration later turns out to be incorrect. (e.g., self settle, self settle with mediation, litigation).
"Should the tax or tax estimate or proration later become inaccurate or change, Buyer and Seller shall make any financial adjustments between themselves once accurate tax information is available and Buyer takes timely reasonable steps to minimize taxes."
This can help with "point of sale" and "ATI" issues, too.
Posted by: Byron King on 03/15/22 (This information is only accurate as of 03/15/22. You must contact SCR for updates and changes to this information after 03/15/22 as laws and regulations may change over time. SCR 803-772-5206 or email info at screaltors.org or email byron at screaltors.org)
This information is not legal advice. This information is intended only to provide general information and may not be relied upon as specific legal guidance. Legal counsel should always be consulted before acting in reliance on this information.