Property Tax Proration Calculator
Split the annual property tax bill between buyer and seller by days of ownership, computing the daily rate, seller's share, and buyer's share.
How to use this tool
- Enter the full-year property tax bill.
- Enter the number of days the seller owned the home in the tax period.
- Confirm the number of days in the tax period (usually 365).
- Read the seller's share and the buyer's share.
- Take the daily rate to your title officer to confirm the local convention.
When a home sells mid-year, the property tax is split by days of ownership. This calculator computes the daily rate and each party's fair share.
Formula
Property tax is split by days of ownership in the tax period:
Daily rate = Annual tax ÷ Days in period
Seller's share = Daily rate × Days the seller owned
Buyer's share = Annual tax − Seller's share
How it works
Property taxes are billed for a full period (typically a year), but a home often changes hands partway through it. Proration divides the bill fairly so each party pays only for the days they owned the home. The party who owned the property for part of the period covers that slice; the other party covers the rest, settled as a credit or debit on the closing statement.
This calculator computes a daily tax rate by dividing the annual tax by the number of days in the period, multiplies it by the days the seller owned the home to get the seller's share, and assigns the remainder to the buyer. The split always adds back to the full annual bill.
Whether the credit flows to the buyer or the seller depends on local custom and on whether taxes are paid in arrears or in advance. In arrears jurisdictions the seller typically credits the buyer for the days the seller owned (because the buyer will later pay the whole bill); in advance jurisdictions the buyer reimburses the seller. Day-count conventions also vary — some areas use a 360-day banker's year or count the closing day to one side. Confirm the convention with your title or escrow officer, and treat this as an even-handed estimate.
Worked example
$3,650 annual tax, seller owned 120 of 365 days
- Daily rate = $3,650 ÷ 365 = $10.00 per day.
- Seller's share = $10.00 × 120 days = $1,200.
- Buyer's share = $3,650 − $1,200 = $2,450.
Seller's share $1,200.00 | Buyer's share $2,450.00 | Daily rate $10.0000
Split of a $3,650 annual bill ($10/day) by seller's days
| Seller days | Seller's share | Buyer's share |
|---|---|---|
| 30 | $300.00 | $3,350.00 |
| 90 | $900.00 | $2,750.00 |
| 120 | $1,200.00 | $2,450.00 |
| 182 | $1,820.00 | $1,830.00 |
| 273 | $2,730.00 | $920.00 |
Key terms
- Proration
- Dividing a periodic charge such as property tax between buyer and seller in proportion to the days each owned the home.
- Daily tax rate
- The annual property-tax bill divided by the number of days in the tax period — the per-day cost used to split the bill.
- Paid in arrears
- When taxes for a period are billed after it ends; the seller usually credits the buyer for the seller's days of ownership.
- Closing statement
- The settlement document (Closing Disclosure / ALTA statement) where prorated items appear as credits and debits to each party.
Frequently asked questions
- How is property tax prorated at closing?
- The annual bill is divided by the days in the tax period to get a daily rate, then multiplied by each party's days of ownership. The seller pays for their days and the buyer pays for the rest, settled as a credit on the closing statement.
- Who pays property tax, buyer or seller?
- Both — each pays for the portion of the period they own the home. The exact mechanics depend on whether taxes are paid in arrears or in advance and on local custom, which determines who credits whom at closing.
- What day count is used for proration?
- Most prorations use a 365-day year and a per-day rate, but some jurisdictions use a 360-day banker's year or specific rules about counting the closing day. Confirm the convention with your title or escrow officer.