January 29, 2018 | by

Before our clients sign contracts for the purchase or sale of commercial real estate, we confirm with local counsel what the real estate tax adjustment or proration will consist of. Many parties will stick to a general boilerplate provision in a contract providing that real estate taxes will be adjusted as of the closing date. However, the standard boilerplate provision may not work well in certain jurisdictions depending on when taxes are assessed and what the local custom is. For example, we recently worked on a sales contract in the Midwest where it is customary for only taxes that become delinquent in the year of closing to be adjusted. Additionally, in some cases there may be special assessments or other unique local features of the real estate tax law you want to address specifically in the contract. If the parties desire, it may be helpful to include a “for example” sentence or two in the proration paragraph outlining exactly how taxes will be adjusted at closing. At closings, the best surprise is no surprise.


For more information, please contact us at
info@jrkasman.com or call us.


Legal Information Does Not Equal Legal Advice. The information posted on our website does not create an attorney client relationship.

The JR KASMAN, PLLC Trending Report and all posts on the Trending Report are intended to inform firm clients and friends about legal developments, including recent decisions of various courts and administrative bodies. Nothing on the JR KASMAN, PLLC website including, without limitation, the JR KASMAN PLLC Trending Report, Twitter Feed or other social media should be construed as legal advice or a legal opinion, and readers should not act upon the information contained on the JR KASMAN, PLLC website, Trending Report, Twitter Feed or other social media without seeking the advice of legal counsel. Prior results do not guarantee a similar outcome.