A bill was recently introduced to Colorado legislatures that proposed a property tax hike for owners of residential properties that engaged in short term rentals. That proposed change has caused quite an uproar in Colorado resort markets like Summit County. Our Realtor organization fought back and as a result we have been told the tax increase on rentals is dead, for now anyway.
The proposed 2020 Short Term Rental Bill would change short term rental properties to a non-residential tax rate of 29%. That’s a significant increase from the residential rate of 7%. The objective of the bill, according to Bob Gardner, is to level the playing field for hotels and motels with the individual owners of rental properties. Hotels and motels are non-residential and are, therefore, paying that 29% property tax rate already.
There has been a lot of concern about how the change would impact our economy in resort areas that count on short term rentals to provide housing to our tourists. Summit Association of Realtors and others stepped up to voice the opinions of property owners, Realtors, property managers and others that would be impacted by the legislations. As a result of a meeting with State Senator Bob Gardner (R- Colorado Springs), the opinions were heard and we have been told that the bill will not move forward in this legislative session. The tax increase on rentals is dead!
This is a concern that is not likely to go away. I expect these discussions about how to best update the laws will continue. At some point, there will be a change. It is up to all of us to let those making the laws know about the possible impacts the potential changes will have. Kudos to all that spoke up and voiced their opinions in this battle.