October 15, 2026 · 4 min read
Property Tax Bills Are Arriving! What Buyers and Sellers Should Know
How property taxes are prorated at closing in Tennessee, and what to do when a tax bill arrives after you buy, sell, or pay through an escrow account.
We strive to provide helpful, accurate information for general educational purposes. However, this content is not intended as legal advice. For guidance on your specific legal situation we recommend consulting a licensed attorney.
Property tax bills are rolling out across many counties, making this a great time for buyers and sellers to understand how property taxes factor into a real estate transaction.
Who Pays the Property Taxes When a Home Sells?
When a property changes hands, property taxes are typically prorated between the buyer and seller based on the portion of the year each party owns the property.
What If the Taxes Aren't Payable at the Time of Sale?
Depending on the county and timing, taxes may not be due when a property closes. This is common in Tennessee! Any unpaid taxes or applicable credits are accounted for during closing so the buyer and seller understand their respective responsibilities.
Typically, the seller credits the buyer for the seller's prorated share of the taxes. The buyer then becomes responsible for paying the full tax bill when it becomes available, either directly or through their mortgage lender's escrow account.
What Should You Do When Your Tax Bill Arrives?
Scenario 1: You're Planning to Buy or Sell
Keep an eye on your property tax bill and share any relevant information with your real estate agent or title company. Having the most current information available helps everyone prepare for closing.
Scenario 2: You Sold Your Property but Received a Tax Bill
Don't panic! In Tennessee, tax bills are generally issued in the name of the owner of record as of January 1, so you may receive a bill even if you no longer own the property. However, don't automatically disregard it. Check your closing documents or contact your title company to confirm how the taxes were handled and whether any action is needed. You may also need to forward the bill to the new owner.
Scenario 3: Your Mortgage Includes an Escrow Account
Wondering why you received a tax bill when your lender handles your property taxes? This can be completely normal! Some counties send bills to homeowners for their records even when taxes are paid through escrow.
To avoid accidentally paying twice, forward the bill to your mortgage lender and confirm that the taxes will be paid from your escrow account. Remember, it's still important to make sure the bill gets paid on time!
At ClearPath Title, we're here to help make the numbers clear and the closing process straightforward. If you have questions about how property taxes were handled at closing, we're happy to help!
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