Taxes & Prorations — How the Money is Calculated

At closing, taxes and some charges are prorated so each side pays their share.

Standard taxes

Illinois bills in arrears. The contract sets the proration method (e.g., 105% of the latest bill). Title adds a line item credit to balance things.

Improved‑but‑not‑fully‑taxed

If the home was renovated or built recently, the tax bill may not reflect improvements. Many contracts require an escrow holdback (e.g., 3% of price) until the accurate bill arrives, then parties true‑up.

Tips

• Ask title/attorney for the estimated proration in your draft settlement statement.
• Confirm HOA assessments and special assessments early.