How Are Property Taxes Prorated at an Arizona Closing in 2026?

At an Arizona closing, the seller credits the buyer for the seller’s share of property taxes owed but not yet paid, calculated through the close of escrow date. Because Arizona property taxes are paid in arrears and Maricopa County splits the annual bill into two installments (first half due October 1, second half due March 1), escrow officers use the most recent published tax bill to prorate on the settlement statement.

This is the question every Arizona real estate agent ends up answering at the kitchen table. Buyers want to know why they owe money for taxes on a year they did not own the home. Sellers want to know why their proceeds are reduced. The math is simple once you understand three things: Arizona taxes are paid in arrears, the tax year is the calendar year, and the AAR contract prorates to the close of escrow date.

What does paid in arrears mean for Arizona property taxes?

Arizona property taxes are billed for the calendar year they cover, but those taxes are not due until later that same year and the year after. The first half covers January through June and is due October 1. The second half covers July through December and is due March 1 of the following year. This is what real estate professionals mean by paid in arrears.

The practical result at closing: on any given day, some portion of the seller’s property taxes for the current period has accrued but has not yet been paid. The seller owes that accrued amount to the buyer, who will eventually receive the bill and pay it.

How does escrow calculate the proration on an Arizona settlement statement?

Arizona escrow officers prorate property taxes using the most recent assessed tax amount from the Maricopa County Treasurer, divided across the tax year on a daily basis. The seller is charged for every day of the tax period they owned the property. The buyer is credited that same amount.

The standard formula looks like this. First, take the most recent annual tax bill (for example, $3,650). Second, divide by 365 to get the daily tax amount ($10.00 per day). Third, multiply by the number of days from the start of the tax period to the close of escrow. Fourth, credit that amount from the seller to the buyer on the settlement statement.

If the seller has already paid the first half installment, that prepayment is also accounted for, and the buyer may owe the seller a credit for any days already covered after the close of escrow date.

What does the AAR purchase contract say about tax proration?

The Arizona Association of REALTORS Residential Resale Real Estate Purchase Contract states that real property taxes payable by the seller are prorated to the close of escrow based on the latest tax information available. Close of escrow is defined as the moment the deed is recorded at the county recorder’s office, not the day the buyer signs.

This matters for two reasons. First, the seller is responsible for taxes only through the recording date, not the contract date or the signing date. Second, latest tax information available usually means the prior year’s bill if the current year’s bill has not yet been issued. If the new bill comes in higher or lower, the parties do not typically re-prorate after closing unless they have specifically agreed to do so.

When are Maricopa County property taxes due in 2026?

For the 2026 tax year, Maricopa County property taxes follow the standard semi-annual schedule. The first half is due October 1, 2026 and becomes delinquent after November 1, 2026. The second half is due March 1, 2027 and becomes delinquent after May 1, 2027.

Late payments accrue interest at 16 percent per year (about 1.33 percent per month) starting the day after the due date. Not receiving a bill does not waive the deadline, so agents should remind buyers to verify their mailing address with the Maricopa County Treasurer after closing.

How does the close of escrow date change the proration amount?

The closer the close of escrow date is to a tax installment due date, the larger the proration credit. A January closing means the seller has accrued only a few weeks of unpaid taxes for the current year. A December closing means the seller has accrued nearly a full year of unpaid taxes, almost all of which the buyer will pay after taking title.

Real estate agents should set expectations early. Buyers closing in the fourth quarter often see large seller tax credits at closing because Arizona’s arrears system has been quietly piling up for the full calendar year.

What about supplemental tax bills and reassessments?

Arizona does not issue mid-year supplemental tax bills the way California does. Property valuations are set by the Maricopa County Assessor based on the Limited Property Value, and changes typically take effect in future tax years rather than being retroactively reassessed at sale.

That said, new construction homes that received a partial-year valuation may see a larger first full tax bill the following year. Agents working on new builds should warn buyers that the prorated amount at closing reflects the partial bill, not the full annual bill they will receive once the home is fully on the tax roll.

How can Arizona real estate agents prepare buyers and sellers for the tax proration line?

A few simple habits prevent surprise at the closing table. Pull the tax history early. A title report from Inspire Title Team includes the current and prior year tax amounts so both sides know what to expect. Explain arrears in plain English. Tell buyers they are not paying the seller’s taxes, they are taking over the seller’s unpaid share for days the seller owned the home. Confirm the close of escrow date drives the math. Pushing the close back by ten days changes the proration. If the parties agree to extend, send the updated date to escrow promptly. Verify the buyer’s mailing address with the county treasurer post-closing. Missed bills create delinquencies, and the new owner is responsible regardless of who originally received the notice.

FAQ: Arizona property tax proration at closing

Are Arizona property taxes paid in advance or in arrears?

In arrears. The tax bill for the calendar year is split into two installments due October 1 of the same year and March 1 of the following year.

Who pays property taxes at closing in Arizona?

The seller pays for the days they owned the property during the current tax year, and the buyer pays for the rest. Escrow handles the math on the settlement statement.

Does the buyer or seller get a credit for property taxes?

The buyer almost always receives a credit from the seller because Arizona taxes are paid in arrears. The seller credits the buyer for taxes accrued but not yet paid through the close of escrow date.

What happens if the tax bill changes after closing?

Under the AAR contract, prorations are based on the latest information available at closing and are not typically reconciled later. If the new bill is materially different, the parties can agree separately to true it up, but escrow does not automatically do so.

Where can I find the current tax amount for a Maricopa County property?

The Maricopa County Treasurer’s website at treasurer.maricopa.gov lets agents and clients look up the current and prior year tax amounts using the parcel number or property address.

Need a partner who explains the closing numbers clearly to your clients? The Inspire Title Team at WFG National Title supports Greater Phoenix real estate agents with title and escrow services built around clear communication and on-time closings. Reach out for a pre-listing title search, a tax history pull, or a fast quote on your next transaction.