When it comes to real estate transactions like a land contract, one question that often arises is who pays the property taxes. The answer to this question can vary depending on the specific terms laid out in the contract.

In general, the party responsible for paying property taxes on a land contract is determined by the terms agreed upon by the buyer and seller. In some cases, the buyer may be responsible for paying the property taxes directly to the local government. This arrangement is typically referred to as the buyer assuming the tax responsibility.

In other cases, the seller may be responsible for paying the property taxes and then billing the buyer for their share. This arrangement is known as a tax and insurance escrow, and it ensures that the property taxes and insurance payments are paid in a timely manner.

It’s worth noting that property taxes can be a significant financial burden for both buyers and sellers, especially if there are multiple years’ worth of taxes owed on the property. Therefore, it’s essential to have clear and explicit terms outlined in the land contract regarding who is responsible for paying these taxes.

Before entering into a land contract, both parties should carefully review and consider the terms surrounding property taxes. It’s also a good idea to consult with a real estate attorney or tax professional to ensure that all legal and financial obligations are being met.

In summary, who pays the property taxes on a land contract depends on the specific terms and arrangements agreed upon by the buyer and seller. Clear communication and understanding regarding tax responsibilities can help prevent financial and legal issues down the road.