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Is buyer responsible for back taxes?
How much of the taxes am I responsible for since I purchased the home? A: Well, to put it simply, you are responsible for all the real estate taxes that have been billed and are unpaid on your home, unless your purchase contract says otherwise.
Who pays tax buyer or seller?
In California, upon the sale of a business, the seller is responsible for collecting the sales tax; and, customarily, the buyer is responsible for paying the sales tax, as on any sale of merchandise in the ordinary course of business. Ordinarily, this is handled by the escrow agent at the closing.
Can you sell a house that is behind on taxes?
The answer is YES. First, your going to need to look at the amount of back taxes you owe versus the value of your property. If your house is worth more than the taxes, and selling the property will pay off the full amount of the taxes, the sale of your house or property will most likely be allowed.
Is seller responsible for back taxes?
The seller is responsible for paying sales tax to the CDTFA on their taxable transactions. A seller is generally allowed to collect the sales tax from you—the customer; however, the seller owes the tax even if they do not collect it from the customer.
When you sell a house do you have to pay taxes?
It depends on how long you owned and lived in the home before the sale and how much profit you made. If you owned and lived in the place for two of the five years before the sale, then up to $250,000 of profit is tax-free. If you are married and file a joint return, the tax-free amount doubles to $500,000.
How many months of taxes do you pay at closing?
Three Months for Taxes… The amount of property taxes collected from you (the buyer) on the Closing Disclosure (CD) will be more than three months. BUT the sellers will reimburse you for their prorated portion of property taxes and your out of pocket net will be three months.
When it comes to property taxes What’s a real estate professional’s responsibility?
To be a real estate professional, a taxpayer must provide more than one-half of his or her total personal services in real property trades or businesses in which he or she materially participates and perform more than 750 hours of services during the tax year in real property trades or businesses.
Can the IRS make you sell your house?
The IRS cannot sell your house without first getting a court judgment approving the sale. Court approval is required by law – Internal Revenue Code 6334(e) requires a U.S. District Court judge to approve an IRS sale of a personal residence before it can be sold.
What’s a typical reason that a seller might opt for a short sale?
The seller must request a short sale with a hardship letter They’ll have to include lots of financial docs (pay stubs, bank statements, list of assets) to prove financial hardship. Classic reasons for requesting a short sale include family or medical emergencies, job loss, or sudden loss of income.