Yes, your share of these taxes can be claimed if you itemize your deductions. Property (real estate) taxes are generally divided between the buyer and seller, so each pays taxes for the part of the year they own the home. See Buyers and Sellers below for details.
- Property (real estate) taxes are part of a combination of taxes whose total is taken as a single deduction. The maximum deduction you can take for the combination of 1 and 2 below is $10,000 (or $5,000 if married filing separately).
- State and local income tax, OR sales tax
- Property taxes (real estate taxes + personal property taxes)
You can claim any property (real estate) tax you were charged in your closing costs. Look for a "real estate tax," "property tax," or “county taxes” charge on your HUD-1 settlement statement.
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.
Be sure to claim the deduction in the year you (or your lender, on your behalf) made the payment. So, if you paid your 2023 property tax on December 14, 2022, claim it on your 2022 return.
You can claim property (real estate) tax you already paid for the calendar year, minus any amount allocated to the buyer. It doesn’t matter if you were reimbursed for the buyer’s share at the close of escrow or not—you can only claim your share of the property (real estate) tax for the time you owned the home.
Here are two ways to see what you were reimbursed:
- It's in Box 6 of Form 1099-S
- Look for "property tax," "real estate tax," or “county taxes” on your HUD-1 settlement statement