It’s important to be aware of the required Mesa rental taxes when you’re a landlord with properties in Arizona. A lot of states don’t have rental taxes, but Arizona does. Self-managing owners and even other property managers are not always aware of this tax, and they don’t charge the tax or pay it. Whether you charge it to your tenants or you don’t, it’s still a tax that you are required and expected to pay.
Mesa Landlord Advice: Avoid an Audit
This tax is administered by a taxing entity, and just like the IRS – they have the power to audit you and assess penalties, fines, and even put a lien on your property. If you have one property, the fines and penalties can add up but they will be manageable. However, if you rent out two or three investment properties, those penalties will accumulate and you’ll find yourself owing a lot of money. So make sure you’re paying this tax and avoiding an audit of your rental property income. If you own a rental property, you have to pay Mesa rental taxes.
Property Management Mesa: Collecting the Tax
At World Class Properties, this tax is no problem for our owners and investors, because we build it into the lease. Our tenants pay the tax, we collect it, and pay it on behalf of our owners to the taxing entity. A big tax change is coming, where all of the cities are handing over the taxing responsibilities to the state. This has been a bit of a problem internally at the governmental level, but everything is catching up and it looks like the State of Arizona will take over all taxing from the cities. This doesn’t have to add to your confusion; just make sure you’re collecting it and paying it. Be compliant or an audit will arrive and you can get in trouble, especially if the audit goes back seven or eight years.
We would be happy to answer any questions you might have about rental taxes. If you would like more information on Mesa property management, East Valley property management, or services in the surrounding areas, please contact us at World Class Properties.