Vacation Rentals
Registration Requirements
Read all information on this page before applying for a Vacation Rental registration
Vacation Rentals in the City of Prescott are required to register with the City of Prescott prior to offering the property for rent for a period of 29 consecutive days or less. There are two different types of registration treatments explained below:
A. If the vacation rental is in residential zoning, you do not occupy the residence during the time period when the property is rented, and the facility is not a hotel, motel, or bed and breakfast the following apply:
- Transaction Privilege Tax License issued by the Arizona Department of Revenue. Begin reporting and paying transaction privilege tax on rental income.
- Vacation Rental Registration with the City of Prescott.
- The total fee for this initial application is $95, consisting a $30 annual vacation rental registration fee and a one-time $65 safety inspection fee. In subsequent years the fee for renewal will be $30.
- Before applying for the vacation rental registration, please review the list of required information before applying online.
- Operational Requirements and Standard Conditions in City Code 4-9.
B. If you occupy and reside at the residence during the time period when the rooms are rented, or the property is in commercial zoning, or the facility operates as a hotel, motel, or bed and breakfast the following licenses apply:
- Transaction Privilege Tax License issued by the Arizona Department of Revenue. Begin reporting and paying transaction privilege tax on rental income.
To get started, we need each customer’s company and contact information up-to-date in our customer database. To begin please complete this easy online registration: https://cityofprescottaz.wispform.com/1892c1c5
(Once customer contact registration is complete and you have a log-in you can complete your Vacation rental registration process)
Vacation Rental Questionnaire
(Questionnaire must be filled out and attached to online application)
Vacation Rental Registration
(Online Only)
Paper forms are no longer accepted
Privilege (Sales) Tax for Vacation Rentals
As a vacation rental operating in the City limits, you will be required to collect and remit transaction privilege (sales) tax on gross income derived from the business activity. As of January 1, 2019, all online short-term vacation rental marketplaces, including Airbnb, VRBO, and HomeAway, are required to register with the Arizona Department of Revenue and collect the tax on bookings, however, the property owner is still required to obtain a Transaction Privilege Tax license regardless of whether the property owner utilizes an Online Lodging Marketplace or not.
Download Online Lodging Marketplace Reporting Factsheet
The City transaction privilege tax rate is 2% of the gross income. For all rental activity for a period of 29 consecutive days or less, there is an additional tax of 3% called transient occupancy or “bed tax”. All transient occupancy transactions are also subject to a state tax of 6.325%. The total tax rate for transient occupancy is 11.325%. If the rental transaction is for a period of 30 days or more, it would be classified as residential rental with a City tax rate of only 2% with no state tax. For more information, visit the privilege (sales) tax page.
Operational Requirements and Standard Conditions for Vacation Rentals
The owner or agent for vacation rentals in residential zoning and not owner-occupied during rental will be responsible for ensuring compliance with the operational requirements and standard conditions set forth in Prescott City Code 4-9.
The following are some important highlights of the requirements and standards for vacation rentals (review the City Code for the detailed list):
- Per City of Prescotspect Land Development Code 6.2.4, B , recreational vehicles, motor homes, utility trailers, camp trailers, boats and similar equipment that is allowed to be stored on residentially-zoned property in accordance requirements of Sec. 5.9, RV, motor homes and Similar Storage, shall not be used for sleeping or habitation purposes.
- Maximum overnight occupancy of the vacation rental unit is specified as two persons per bedroom (thirteen years of age and older), plus two additional people per rental. For example: a 3-bedroom Vacation Rental allows a maximum overnight capacity of 8 people.
- A local contact person is required who can respond in-person to the site of the vacation rental within 45 minutes to initial or successive complaints.
- Prior to occupancy, the local contact person shall provide the responsible person of a vacation rental with the following information (this information must also be posted in a conspicuous place within the unit):
- Good Neighbor Brochure
- Name of the local contact person and 24 hour phone number
- A copy of the vacation rental registration certificate
- Maximum overnight occupancy and notification that failure to conform is a violation of City Code 4-9
- Trash pickup day and applicable rules pertaining to leaving or storing trash or refuse on the exterior of the property
- Notice that noise levels shall not exceed those described in City Code 5-4
- City Code Chapter 4-9
- Notice that the occupant may be cited or fined for creating a disturbance or for violating other provisions of the chapter
- Prior to occupancy, the owner or owner’s agent shall enter into a written rental agreement as specified in City Code 4-9-6(G)
- The owner is required to notify property owners in immediate proximity on all sides that the property is used as a vacation rental including the name and 24 hour telephone number of the local contact person. A template letter is available below under resources.
Resources
Prior to occupancy, the local contact person shall provide the responsible person of a vacation rental with the following information (this information must also be posted in a conspicuous place within the unit):