Seller's Net Sheet on a July 15 Closing
A contract is written at $248,000 with closing set for July 15. The seller has owned the property for years and the current year's property tax bill of $1,440 has not yet been paid (it is payable later in the year). The listing agreement provides a 6% gross commission, split 50/50 with the cooperating broker. West Virginia excise tax on the deed is $1.10 per $500 of consideration or fraction thereof, customarily paid by the grantor. The seller's loan payoff on the closing date is $142,300, plus $347.70 of accrued per diem interest. Deed preparation is $450. The buyer's $5,000 earnest money is held in the brokerage's trust account.
1. Calculate the West Virginia excise tax on the deed and state who pays it.
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Calculation:
- $248,000 ÷ $500 = 496 full increments (no fraction here)
- 496 × $1.10 = $545.60
Who pays: the grantor - the seller - under the customary allocation. Even if the contract shifts the tax to the buyer, it is a transfer cost of the seller's deed and should be shown on the settlement statement deliberately, not by default.
Watch the fraction rule. "Or fraction thereof" means a price that is not a clean multiple of $500 rounds up. A $248,750 price would be 497.5 → 498 increments → $547.80, not $545.60. Small, but it is exactly the kind of detail that gets tested and that a closing agent will catch.
2. How is the property tax prorated at a July 15 closing, and in which direction does the money move?
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Direction: the seller owes the buyer. The seller occupied the property from January 1 through closing while the current year's tax was accruing and unpaid. The buyer will pay the whole bill later, including the months the seller occupied. So the settlement statement shows a debit to the seller / credit to the buyer.
Day count (365-day method):
- January 31 + February 28 + March 31 + April 30 + May 31 + June 30 = 181 days
- Plus July 1–15 = 196 days
- $1,440 ÷ 365 = $3.9452 per day
- 196 × $3.9452 = $773.26
Judgment points:
- Whether the closing day itself is charged to the seller is a convention that must be applied consistently; a one-day swing here is about $3.95, but on a large tax bill it matters more.
- A 360-day (12 × 30) method produces $4.00/day × 196 = $784.00, a $10.74 difference. Either method is defensible if it is stated on the settlement statement - never mix methods between the tax proration and the interest proration.
- If the taxes had already been paid for the year, the direction reverses: the buyer would owe the seller for the remainder of the year.
3. Compute the seller's net proceeds. Explain how the buyer's $5,000 earnest money is handled.
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Seller's estimated net proceeds:
| Line | Amount |
|---|---|
| Contract sale price | $248,000.00 |
| Less total commission (6%) | ($14,880.00) |
| Less WV excise tax | ($545.60) |
| Less property tax proration (debit seller) | ($773.26) |
| Less deed preparation | ($450.00) |
| Less loan payoff | ($142,300.00) |
| Less accrued per diem interest | ($347.70) |
| Estimated net to seller | $88,703.44 |
The $5,000 earnest money is not a seller deduction. It is the buyer's money, applied as a credit toward the buyer's cash due at closing. The seller still receives the full $248,000 contract price; the earnest money simply reduces what the buyer must wire. Deducting it from the seller's side - a common error - would understate the seller's proceeds by $5,000.
Also worth flagging to the seller: the 50/50 split is an internal matter between the brokers; the seller pays $14,880 total and nothing more. And the per diem interest runs to the payoff date, so a delayed closing changes that line daily.