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1. What is the long-term rental exemption?

It is a real property exemption of up to $200,000 on a parcel that is occupied as a long-term rental for twelve (12) consecutive months or longer to the same tenant.  The exemption will be effective January 1, 2022.

2. How do I qualify for the long-term rental exemption?

You must apply for the exemption by December 31 and attach a copy of the signed long-term lease agreement.  

3. Where can I apply for the long-term rental exemption?

The application can be found on the Real Property Assessment Division website. 

Scroll down to Exemption Forms.

4. What if I already have a home exemption, but there’s also a long-term rental on my property? Will I get to keep that exemption? Can I have both exemptions?

You will be eligible for a $100,000 long-term rental exemption in addition to the home exemption and your property will still be classified as Owner-Occupied.

5. Can I have more than one long-term rental exemption?

More than one exemption is only allowed if they are on separate parcels.

6. Is there any portion of my property that will not qualify for the long-term rental exemption?

Any portion used for commercial purposes will not be entitled to the long-term rental exemption.

7. How can my property be classified as Long-Term Rental?

If the parcel does not qualify for a home exemption, the home must be occupied as a long-term rental, with a signed contract to lease for twelve (12) consecutive months or longer to the same tenant.  A long-term rental exemption application must be filed with the RPA Division by December 31.

8. What if my property taxes are delinquent on the property used as a long-term rental?

No exemption will be allowed if the property taxes are delinquent for more than a year.

9. What if my property ceases to qualify for the long-term rental exemption and classification?

The owner must report any change in use to the RPA Division within thirty (30) days of that change.  The property will be reassessed at its highest and best use.

10. What if my home is owner-occupied and I rent a room or rooms long-term? Would I qualify for the $300,000 exemption?

No, you would qualify for the home exemption ($200,000) on the portion of the home that is not rented.

11. What about a condo rented long-term in a building that allows short-term rentals and is zoned Hotel/Resort? Would this qualify the owner for the $100,000 exemption?

Condominiums that are one unit, regardless of zoning, would qualify for the $200,000 long-term rental exemption.

12. What about a condo rented long-term in a building zoned Apartment, that allows short-term rentals and is on the Minatoya List? Would this qualify for the $100,000 exemption?

Condominiums that are one unit, regardless of zoning, would qualify for the $200,000 long-term rental exemption.

13. What about a house that is not owner-occupied with multiple rental units?

One house would get the $200,000 exemption.  The entire property gets the long-term rental rate, as long as none of the homes are rented short term.

14. Could I rent to myself and get the long-term rental exemption?

No.  Even if you rent to yourself, you are still an owner.  (MCC 3.48.150 defines unusual ownership situations.)

15. What if an LLC rents to me?

If you do not live there 12 months, no.  MCC 3.48.466 states that for twelve (12) months, the dwelling must be:

1. occupied as a long-term rental, and
2. under a signed contract to lease.

If you live elsewhere or do not have a U.S. visa that allows you to occupy for 12 months, you do not qualify.

If you live there all year long, we suggest that the LLC rent to you for 5 or 15 years, so that you can qualify for the home exemption.