Tax problems with newly bought property

[Trevor Fritz]

I bought a condo unit back in March. I got a good price on the unit and have been very happy with the profit I am making on it. Recently I received the tax bill for 2014. When I bought the property, the taxes were shockingly $0 because of deductions the previous owner received (she was out of state, elderly lady, not sure what else). I went over this with my lawyer a few times and he simply replied that her deductions could make this possible. I was surprised, but I went along with it. 

When I received the 2014 taxes, the bill was for a significant amount of money that I did not account for.  One reason he guessed might have been the case is the previous owner did not keep the deductions in place or file the paperwork. He said because this breaks the contract we could go after them. The only problem is, the owner now lives in Texas (the property and I are in the Chicago suburbs) and had been difficult to get a hold of during the closing and negotiating processes. This was my first deal and I have learned a great deal, but I am looking for some guidance and feedback from fellow investors. I appreciate the help and hope to give back in some capacity to you all!

[Wayne Brooks]

We can't read your tax bill, so we can answer your question accurately.  Sounds like you need the taxing authority to explain it to you.  Your tax liability should start March 2015, period.  It sounds like, maybe...part of her exemption was homestead exemption, which maybe the tax authority found out was improper since she no longer lived there.  They then recalculated her tax due, which gave Her a larger tax bill.  But, that tax bill Does attach to the property.  If this is the case, it may be the title/closing co. responsibility to get the proper reimbursement from the previous owner, or not.  Either way, you should only have to pay for taxes While You Owned It.  But, collecting from the former owner may be an issue.