Residential rental licensing matrix: tax tips

Your Guide to State, Local, Federal, Estate + International Taxation

rental, real estate, taxAre you looking to purchase a residence to use as a rental property and you are unsure if you need to report and pay sales taxes for the city it is located in? Or maybe you are a tax professional who has a client asking you this question. In either case, I just found the most helpful thing on the Arizona Department of Revenue’s (ADOR) website. This link will take you to the ADOR’s “Residential Rental Licensing Matrix.” Each question will guide you to answer the question of whether or not you are required to have a TPT license for the city that your property is located in.

For example, let’s say that I just purchased a residential property in Mesa and I want to turn it into a rental property. If I follow the questions on the Matrix down to question five, I can see that Mesa does not require me to have a city license. However, if I also own another residential rental in Chandler, then I am required to have a city license for both Mesa and Chandler.

If you find that after reading this, you are required to obtain a license, here is the application to apply for a Residential Rental Transaction Privilege license.

Please note that this is only for residential rental properties, not commercial properties.

Kelsey Olsen