Should property tax escrow be included in the lease terms?

If so when? Can a landlord withdraw from the security deposit to pay the tenants portion of the taxes if they were to default on the lease? Why would both a security deposit and escrow be required?
In Leasing Property - Asked by kenneth m. - Mar 10, 2014
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Answer(s)

Chris T.
Broker/Agent
Suwanee, GA

Security deposit shall not be used for anything during the lease term. It shall be returned to tenant at end of lease minus any repair deductions within 30 days after expiration. During lease term, if tenant default, it goes to court to collect. In commercial lease, normally tenant pays in advance in monthly installment of his portion of the tax and insurance. In residential, there is no such provisions. It is just a gross monthly rent amount

Mar 10, 2014
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Glen W.
Lender/Mortgage Broker
Atlanta, GA

I've seen leases structured where the tenant pays every month and some that bill the tenant annually. You'[ll need to look at the lease provisions, but typically on default you can apply the security deposit to unpaid rent, towards taxes, etc...

Mar 11, 2014
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Ron S.
Broker/Agent
Miami, FL

The short answer is property tax escrows CAN BE included in the lease terms. It should be a separate escrow account designated for property taxes. I would have the landlord's and tenant's attorneys sign off on this provision.

Mar 11, 2014
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