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Property ownership issues To: New property owner Ref: Property ownership issues explained. Who gets the tax bill? From time to time, confusion exist as to who actually should receive a property tax bill. State of Maine law clearly states that each property must be assessed to the last known owner of record as of April 1st of each year. Therefore, all tax bills go to the owner of record as of April 1st of the tax year. Per city policy we do not mail tax bills to banks, mortgage companies or any other third party. Our Tax Collector does produce electronic reports for mortgage holders who ask for billing information, but they do not get your bill. If your taxes are paid by a mortgage company or other third party, you are responsible for forwarding the tax bill to them. What happens when I sell my home? If the sale of a property occurs before April 1st, there should be no confusion as to the owner of record. The City of Saco will receive notice from the Registry of Deeds that the property has been sold, and we will assess the new owner of the property. The owner of record will get their own tax bill for the ensuing year. What happens should the sale of a property occur after April 1st? This is when things may get confusing. If you owned your home as of April 1st, you are assessed for the entire tax bill. The assessment of these taxes in your name creates a liability. Therefore, it is very common (at the closing of a property sale) for the April 1st owner to request the new owner pro rate the tax bill based on the city or town's fiscal year. The theory being that the old owner is moving on and will not be around to use the city services, while the new owner will be so he or she should pay the appropriate portion of the taxes due on the property. This proration of taxes has been going on for years and in most cases works fine. A word of caution to the seller: the agreement of proration of taxes is a civil contract and will not shift your liability to the new owner. The new owner's liability starts the April 1st of the following year. If the current taxes are not paid, the Tax Collector must file a lien in the old owners (sellers) name because they were the owner of record as of April 1st. Our Tax Collector will make every effort possible to notify both parties as to any past due taxes prior to the formal lien process. It would make sense, then, to make sure the new owner pays the taxes he or she agreed to in the civil contract. Remember - it is your good credit that is on the line!!!!!!! What is the difference between the tax year and fiscal year? Tax Year: The tax year is easy to understand as it's really one day, April 1st of each year. Maine law refers to the tax year, but many other states call it the tax date. For this hand out I use the term "tax date", as I think it is easier to understand. The tax date controls and is used for three primary reasons:
This is an example of how it works:
Therefore: $175,000.-13,000. (Homestead exemption) = $162,000. Multiply by the tax rate of .01332=$2,157.84 in property tax for the fiscal year. Property taxes in Saco are billed in two installments. In terms of time periods of coverage, the first half bill covers occupancy from July 1-Dec 30, and the second half bill covers occupancy from Jan 1-June 30. The due date(s) for Saco property taxes are set each year by City Council. This year the due date(s) are as follows: 1st half is due September 14, 2007 2nd half is due March 14, 2008 |
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