How will Sue's prepaid property taxes appear on her closing statement?

In real estate transactions, prepaid property taxes are typically reflected as a credit on the seller's side of the closing statement. This is because the seller has already paid a portion of the taxes for the period that the buyer will be responsible for after the closing.

If Sue's prepaid property taxes amount to $721.50, then that is the figure that will appear as a credit on her closing statement. This amount is credited to offset what the buyer might need to pay for property taxes going forward, essentially acknowledging that the seller has already covered part of the tax bill prior to the sale.

Understanding the treatment of prepaid expenses in a closing statement is crucial for correctly interpreting how these amounts affect both the seller and the buyer. In this scenario, since the amount reflects Sue's prepaid property taxes, the correct portrayal as a credit ensures that the financial responsibilities are accurately distributed during the transaction.