Wednesday, March 29, 2006

Real estate tax proration

Had a good reminder given to me when I met with our accountant to finish up our tax filings for fiscal 2005. My wife and I had bought a condo at the end of '04 and were given the typical real estate tax credit at closing. But upon presenting our accountant with our actual taxes paid, the credit had been too low! Granted, that overage is still a tax deduction but it's not the same as getting the correct amount of cash up front at closing.

I know the lawyer who handled our closing pretty well (it was me) and I know we dropped our proration percentage to 105% after an initial offer we made was rejected rather than upping the sales price...so these were things personal to us. But just know that everyone you're representing as lawyer or realtor are going to their accountant's just like me and seeing that overage on property taxes and they should know that a higher proration should have been in the contract!

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