Gilbert, AZ · Member since 2015 · 6 posts · 1 vote
The first time I rented, a realtor did everything for me. He charged a 1.5 sales tax against the monthly rent fee. I did not specify that I would be charging sales tax when I accepted their application and approved them. I am meeting them in a few days to sign the lease. Am I required to charge them the sales tax? Or can I just charge them the rent fee?
Also do I have to write a check to the state for the sales tax, or is this done automatically when I file my taxes?
@Art Scott is right on the money. Arizona allows municipalities/cities to impose a rent tax (sales tax?) on rental units. Only a few cities in AZ actually collect a rent tax. Each city sets their own tax rate. In my city (Sierra Vista), the tax rate is 1%. My city only collects it from landlords who have 3 or more SFR rentals in the state or 1 or more multi-family rentals. Sierra Vista also requires the landlord to obtain a business license and a permit to operate a business from home. (I don't think the landlord requires either of these if using a Property Management company.)
The AZ state legislature is attempting to pass a bill to do away with the rent tax state wide. But many cities are fighting this because they don't want to admit the cost gets passed on to the tenants.