Bought a house to flip, now ready to sell and find out unpaid real estate taxes! HELP

[naenae52]

What is the name of your state? Nebraska

We bought a home in Cass County Nebraska so we could flip the house. We have had it since 10/29/07. When the home was purchased, the Title Company said that there were no taxes from 2007 that were due as the previous homeowner was exempt due to a homestead exemption.

Now, when we are ready to list the house, we find out that there is tax due of over $1700 for 2007. Can someone please let me know if we are responsible for the full amount of taxes for 2007? Or is that something that the Title Company is responsible for since they should have taken care of that? Thank you so much!!!

[LindaP777]

Originally Posted by naenae52

Now, when we are ready to list the house, we find out that there is tax due of over $1700 for 2007. Can someone please let me know if we are responsible for the full amount of taxes for 2007? Or is that something that the Title Company is responsible for since they should have taken care of that? Thank you so much!!!

Check your HUD statement (settlement statement at closing). Look and see if you see a charge to the seller for "property taxes" and it will have the date you closed, for the rest of the year. Keep in mind, property taxes are paid in a rears. At closing, you would have been given a credit for the taxes paid in the future. So the taxes currently due are from 2007, but your seller gave you that money in advance at closing, so now when the taxes are due, you pay them.

[naenae52]

Linda - Thank you. I did check the statement and there are no charges to the seller for the property taxes. As they told me at closing, the previous owner was supposed to be exempt from the taxes due to a homestead exemption.

Any other ideas? Thanks so much.

[FlyingRon]

Huh? You are responsible for the property taxes from the time you purchased on. YOU are responsible. Not the bank, not the title company. If there had been either prepaid taxes (money due to the seller) or an arrearage (property taxes due at the time of the sale) then that would have been reflected on the settlement sheet. Howver, the fact you are not exempt means that from the time of sale you are liable for the taxes you incur.

You need to find out the exact nature of the taxes owed. If any predate the sale, you may be able to get out of that. Of course, it's a no-brainer if you have an owner's title policy. Otherwise, you'll have to see if the county misbilled you or if the seller owes you the money.