Question

Aseller closed on his house on november 15. the annual tax bill for the current year is $1,475, which will be paid in arrears by the buyer. what is the seller's portion of the tax bill if the seller owns the day of closing, the taxes are based on a calendar year, and one uses the 360-day method?

Answer 1

Answer:

$1,291

Explanation:

The computation is shown below:

Per day allocation = $1,475 ÷ 360 days = 4.0972

Now the days of the seller is counted from January to October month i.e

= 10 months × 30 days

= 300 days

And, add the 15 days of November, so the total number of  days is 315 days

So, the seller portion of the tax is

= 315 days ×  4.0972

= $1,291

The calendar year started from January month and we take the same for the above calculation