Sec. 1. 36 MRSA §558, as repealed and replaced by PL 1981, c. 23, is amended to read:

§558. Taxes prorated between seller and purchaser

A purchaser of real estate may agree with the previous owner or party to whom the real estate was formerly taxed to pay the pro rata or proportional share of taxes. Unless otherwise specified by the parties to the agreement, the taxes shall must be prorated over the period of the fiscal year of the municipality in which the land is located. With respect to a real estate transaction in which all of the funds known to be necessary or reasonably necessary to fulfill the proration agreement are not secured at the time of sale in an escrow account established within a financial institution, a disclosure statement clearly defining the terms of the proration agreement and the financial obligation of the seller and the purchaser to pay in full their respective property tax charges for the subject property during the tax year current to the date of sale must be prepared by the seller and provided to the purchaser at the time of sale.

SUMMARY

This bill requires a person selling real estate to provide to the purchaser a disclosure statement at the time of sale clearly defining the terms of the proration agreement and the respective property tax obligations of the purchaser and seller in order to completely fulfill the property tax obligation, unless all of the funds necessary to fulfill the proration agreement are secured at the time of sale in an escrow account.