Renter's Tax

• Arizona has two kinds of renter’s tax: commercial and residential. Commercial taxes are paid on buildings used for business purposes, and residential taxes are paid on buildings used as dwellings. Cities set different percentages for renter’s tax, so check with your local tax collection agency to determine how much you owe. The tax applies to the landlord, not the renter, though a landlord might choose to offset his loss by increasing the rent on his property.
  
  

Application

• If a landlord is subject to a renter’s tax, there is another expense he faces as well. Because landlords are taxed as a business in Arizona towns that impose the tax, many must apply for business licenses. Business licenses aren’t free and take some time to receive. Once a license is approved, the town taxes the business as usual and audits it if necessary. Landlords receive tax bills and must make payment according to the laws of the town where they do business. Failing to pay taxes can result in penalties including late fees and judicial action.
  
  

Other Considerations

• Not all landlords in Arizona are subject to the renter’s tax. If you rent out only one property, the city where you live might not impose a tax. The amount of taxable revenue you make determines when you pay your renter’s tax. In Phoenix, landlords earning less than $4,999 only need pay once a year, by Jan. 20. Landlords earning between $5,000 and $49,000 must pay quarterly, on the 20th day of the month after the reporting quarter. Landlords making more than $50,000 per year must pay on the 20th of each month after the income is received.
  
  

Arizona Landlord Tenant Laws

• If you’re a new Arizona landlord, stay up to date on the legal relationship you have with your tenants. The Arizona Residential Landlord and Tenant Act lays out your obligations and the obligations of your tenants. For example, you can charge your tenants separately for a utility bill if you do not want your renters making their own payments. While you can’t increase the price, you can charge a fee for the administrative costs you incur paying the bill. It also includes laws about breaking a lease, bedbug control, security deposits and many other issues landlords and tenants face.