In Ohio, property taxes are paid one year behind — which means when you sell, you've already used part of the current tax year without paying it yet. At closing, the title company credits the buyer for the months you owned the home this year. This is called tax proration. It shows up as a debit on your closing statement, and it often surprises first-time sellers because the county hasn't billed you for it yet.
One of the most confusing line items on a Columbus seller's closing statement has nothing to do with your mortgage, your agent's commission, or the conveyance fee.
It's the property tax proration credit — and most sellers don't see it coming.
Here's why it happens, how it's calculated, and what it means for your bottom line.
Ohio Property Taxes Are Always Running One Year Behind
In most states, you pay property taxes when they're due. In Ohio, the system works differently: you pay last year's taxes this year.
The bills you're paying right now in 2026 cover taxes owed for 2025. When 2026 ends and 2027 begins, that's when the county will bill you for 2026.
That delay is what creates the proration issue at closing. When you sell your home mid-year, you've been living in it for part of 2026 — but the county hasn't billed you for that time yet. Someone has to cover it, and in Ohio, that responsibility falls to you as the seller.
It's not a penalty. It's not an extra charge. It's simply the bill catching up to the timeline.
What Is Tax Proration — And Why Does It Show Up on Your Closing Statement?
Tax proration is the process of fairly dividing property tax responsibility between you (the seller) and the buyer, based on how many days each of you owned the home during the current tax year.
Here's the logic: the buyer will eventually receive the full tax bill for 2026. But they only owned the property for part of the year. So at closing, you give them a credit — cash they'll use toward that future bill when it arrives.
On your settlement statement, this shows up as a debit to you and a credit to the buyer. The title company calculates the exact amount based on your property's assessed tax rate and your specific closing date.
The most common reaction I hear from first-time sellers: "Wait — I'm paying taxes I haven't even been billed for yet?"
Yes. And it's completely standard across Ohio.
Long Proration vs. Short Proration: What Central Ohio Uses
Ohio allows two different methods for calculating how much you owe at closing, and the one used in your transaction depends on what's specified in your purchase contract.
Short proration assumes last year's taxes have already been fully paid and only calculates your share of the current year. It's the simpler calculation and is more common in the Toledo and Dayton markets.
Long proration is more comprehensive. It calculates from the beginning of the previous tax cycle all the way through your closing date — which means it also accounts for any half-year installments that are still outstanding when you close. Long proration is the standard method used in Central Ohio, including Franklin, Licking, Fairfield, and Pickaway Counties.
In practice, long proration typically results in a larger credit to the buyer than short proration. When you're reviewing your seller net sheet — the document that shows line by line what you'll walk away with — your agent or title company will specify which method applies. This distinction can swing your bottom line by several hundred to several thousand dollars, depending on your property's tax rate and when you close.
A Real Example: What This Looks Like in Columbus
Let's make this concrete. Say your annual Franklin County property tax bill is $4,800 — about $400 per month.
You close on September 15. You've owned the home for roughly 8.5 months of 2026, none of which has been billed yet. Using long proration, your credit to the buyer at closing would be approximately $3,400.
That $3,400 appears as a debit on your side of the closing statement. The buyer receives it as a credit — money they'll use when the 2026 tax bill arrives next year.
Your total property tax obligation didn't go up. You're not being double-charged. You're simply settling up for time you lived in the home, so the buyer isn't stuck covering your share of a bill they didn't generate.
What Shows Up on Your Closing Statement
The specific line items vary slightly by title company, but you'll typically see one or more of the following:
- Tax proration — seller's portion: The credit owed to the buyer for the current tax year, based on your closing date and the long proration calculation.
- Unpaid tax installment: If either of the two annual half-year bills is still outstanding at the time of closing, those get settled here as well.
Your agent should walk you through your estimated settlement statement before closing day so nothing catches you off guard. The title company will have all of this calculated in advance — and if any of the numbers look off, you have every right to ask for a line-by-line explanation.
How Proration Fits Into the Full Picture of What You'll Pay at Closing
Property tax proration is one piece of a larger closing cost picture for Ohio sellers. In addition to the proration credit, you'll typically pay:
- Realtor commission (typically 5–6% in the Columbus metro)
- Owner's title insurance (in Central Ohio, this is customarily paid by the seller)
- The conveyance fee (Franklin County charges $4 per $1,000 of sale price — $1 state, $3 county)
- Title search and escrow fees
- Possible seller concessions negotiated during the offer process
Add it all up and total selling costs in Columbus typically land between 8–10% of your sale price. On a $350,000 home, that's $28,000–$35,000 coming out before your check hits the bank. That's why knowing your real numbers before you list — not after — matters so much.
If you're also thinking through what repairs or updates might be worth making before you put the home on the market, I've put together a breakdown of the renovations that actually move the needle on your sale price in Central Ohio.
Frequently Asked Questions
What is property tax proration in Ohio real estate?
Property tax proration is the process of dividing property tax responsibility between the seller and buyer based on how many days each party owned the home during the current tax year. Because Ohio taxes are paid one year in arrears, sellers owe a credit to the buyer at closing to cover the months they occupied the home that the county hasn't billed for yet.
Why does Ohio pay property taxes in arrears?
Ohio's property tax system bills owners for the previous year's taxes — meaning your 2026 tax bill won't arrive until 2027. This creates a timing gap when property changes hands: the seller has used part of the current year without paying for it yet. At closing, the proration credit resolves that gap so the buyer isn't stuck paying for the seller's portion of the year.
What's the difference between long proration and short proration in Ohio?
Short proration calculates only the current year's share, assuming prior installments were paid. Long proration includes any outstanding prior installments as well. Central Ohio — including Franklin, Licking, Fairfield, and Pickaway Counties — typically uses long proration, which can result in a larger credit to the buyer and a larger debit on the seller's closing statement.
Does the property tax credit reduce my net proceeds when selling in Ohio?
Yes. The tax proration credit reduces what you net at closing because it's a debit on your side of the settlement statement. However, it's not an extra tax — it's settling up for taxes you already owe but haven't been billed for yet. Your seller net sheet will include this estimate so you know your actual take-home before closing day.
Who calculates the tax proration amount in Ohio?
The title company calculates the tax proration based on your property's current tax rate, the county's proration method (long or short), and your closing date. You don't need to calculate it yourself — but reviewing it with your agent before closing ensures there are no surprises on your settlement statement.
Ohio's property tax system isn't complicated once you understand why it works the way it does. You've been living in your home. The county hasn't billed you for this year yet. At closing, the title company makes sure that's settled fairly — so the buyer isn't paying for time they didn't own the property.
What matters for you as a seller is knowing this number before you list. Your proration credit, combined with the conveyance fee, title insurance, and commission, shapes exactly what you'll walk away with. That number deserves to be clear before you make any decisions about listing price, timeline, or your next move.
Curious what your Columbus home would actually net after all of it? Get a personalized home valuation, and I'll run your real numbers with you — proration, commission, conveyance fee, and all.
About Mark Dunn
Mark Dunn is a Realtor® with Howard Hanna serving Central Ohio, including Columbus and Licking County. He is positioned as a Top VA Realtor in Central Ohio, specializing in VA buyers, first-time homebuyers, investors, and homeowners looking to sell their properties.
Check out this article next
