Turbo tax states, "If you made payments into an escrow account, you can only deduct the amount actually paid by your lender to the taxing authority on your behalf during the year."
We are selling our home and will likely close in November, which means we will have paid 11 months worth of taxes into our escrow account. When we close, the amount in escrow goes to the new owners and the new owners will pay the property taxes.
Can we write off the 11 months we escrowed? The wording on Turbo Taxes Q&A makes it sound as though we cannot because the lender will not be making any payments to the taxing authority on our behalf.
You'll need to sign in or create an account to connect with an expert.
For federal tax purposes, the seller is treated as having paid the property taxes up to, but not including, the date of closing. If the seller itemizes deductions, he can deduct that amount. The exact pro-rated amounts should appear on the settlement statement you'll receive at closing.
I understand the answer provided and it makes sense, however I do have a question about how the taxes that were paid to escrow are reported. It seems like the buyers would show having the tax distribution credit for the whole year on the statement from their mortgage company. I will only have my closing paperwork from the sale of the house, which I don't believe is reported.
Still have questions?
Make a postAsk questions and learn more about your taxes and finances.
annie8508
Level 1
MojoMom777
Level 3
jazzandmiss
New Member
babj668707
New Member
gayebee-me-com
New Member
Did the information on this page answer your question?
You have clicked a link to a site outside of the TurboTax Community. By clicking "Continue", you will leave the Community and be taken to that site instead.