Prescott, AZ (January 9, 2025) — As of January 1, 2025, long-term residential rentals are no longer subject to city transaction privilege tax (TPT).
Starting January 1, 2025, if you have residential rental property, you should NOT collect and remit city TPT on income received from that property. Property owners must still register the rental property with the county assessor.
The change does not affect:
- Vacation Rentals, hotels, motels and all other transient lodging businesses must still collect, file and remit TPT under the transient lodging and hotel classifications.
- Commercial leases and rentals must also still collect, file and remit TPT for any income derived from commercial rent under the commercial lease classification.
This ONLY applies to long-term, residential property rentals that are reported to the Arizona Department of Revenue under business code 045.
TPT licenses that contain only the business code of 045 for residential rentals have been closed by the Arizona Department of Revenue as of December 31, 2024, and will not be renewed. Property owners can still file for prior periods online even if the license has been canceled or closed.
If you have any questions, please contact the City’s Tax Compliance Analyst 928-777-1268.
