Taxes are prorated as though paid in advance with the seller being responsible for all tax levies made prior to, but not including, the date of closing. A tax proration is something that is negotiated between buyer and seller and is agreed upon in writing in the purchase agreement.In Michigan, the buyer and the seller normally split these expenses, but there are a number of variables that can affect who is responsible for what. The buyer and seller both pay property taxes, due at closing. Generally, the seller will pay a prorated amount for the time they've lived in the space. File Form 5156, Request for Tax Clearance Application if you: Want to know your current total tax liability with the Michigan Department of Treasury. For federal income tax purposes, the seller is treated as paying the property taxes up to, but not including, the date of sale. Are there any tax implications of selling my home in Michigan? Throughout the term of the mortgage, an escrow account will hold funds for taxes and homeowners insurance. See What You Qualify For.
