Fountain Hills is recognized nationally as a desirable location for winter visitors, much like the neighboring communities of Paradise Valley and Scottsdale. Many visitors come for the weather and beautiful surroundings. Others may come for the vicinity of world-class golf courses and seasonal events like Spring Training, Waste Management Open, or other major sporting events that the Phoenix metro often hosts. Thanks mainly to the short-term lodging market, the community has experienced substantial growth due to the increased use of online hosting platforms.
The Town of Fountain Hills has adopted new regulations to protect neighborhood investments, housing values, and community safety. The updated rules go into effect on Feb. 1, 2023. For information and resources on the steps needed to comply with rental home property ownership, go on the Town of Foutain Hills website at www.fountainhillsaz.gov/Rentals.
The goal of the updated regulations is to ensure that property owners are: responsible for their property and tenants to protect the quiet enjoyment of our neighborhoods; reduce impacts on neighbors; make visitor stays pleasant for guests and neighbors alike; decrease or eliminate unruly behavior, and support the responsive hosts and property owners.
The ordinance generally describes and defines definitions and processes for property owners. These include an annual fee of $250 per property, emergency contact information, prohibited uses, neighborhood notification before the rental of a unit/home, advertising requirements, posting on the property, insurance, background checks, permit suspension, enhanced penalties, appeal process, judicial relief, and severability. Additionally, there is a provision to allow the Town to inspect properties to ensure compliance with the ordinance or any provision of Town building, fire, or zoning codes.
The Arizona Department of Revenue administers the transaction privilege tax for the Town of Fountain Hills; property owners must report and pay their Town of Fountain Hills transaction privilege tax to the Department of Revenue. Taxes can be included in the overall price or charged to the renter as a separate line item. If a property management company is being used, the property owner still needs to file their tax license with the Department of Revenue.
All rental properties are subject to tax regardless of the number of rental units owned. Property owners must be licensed and pay tax if leasing or renting real property located within the Town of Fountain Hills. In addition, all residential properties used as a rental in the Town of Fountain Hills must be registered with Maricopa County at https://preview.mcassessor.maricopa.gov/page/residential_property/forms as a rental.
The Town of Fountain Hills is interested in pursuing all rental properties for compliance. The Town will gladly research the location and verify all tax and licensing requirements are met. To report a rental property for licensing compliance, please email the Town at rentaltax@fountainhillsaz.gov.
In addition to the standard 2.9% tax, residential rentals of less than 30 days are subject to an additional 4% transient tax (Hotel/Motel Classification) for the Town and 7.27% for the County. "Transient" means any person who, for any period less than thirty (30) consecutive days, either at their own expense or at the expense of another obtains lodging or uses any lodging space for which a charge is made on accommodation or use of lodging space.