New Tax Laws for renting a home in the Sedona AZ Home Marketplace
AZ Tax Requirements for Landlords
Starting in 2011, there is a new tax requirement for landlords whether or not you own a home in the Sedona AZ Home market or anywhere in the States. All landlords who receive $600 or more in rent for the year must send a 1099 to all service providers that the landlord paid $600 or more during the year, such as plumbers, carpenters, yard services, and repair people.
The new requirement applies to owners of both residential and commercial property in the Sedona AZ Home market to anywhere in the states. Prior to 2011, this requirement had only applied to those involved in full-time property management, but now the requirement covers all types of landlords. Landlords will need to gather federal tax ID numbers from service providers in order to file the 1099s. Failure to file the 1099s with the IRS can result in fines of $50 per 1099 not filed with the IRS. In 2012, these requirements will expand to cover providers of good to landlords.
The National Association of Realtors has actively opposed this change in the law and is working with others to have this requirement repealed or otherwise modified. Congress took this action in order to assure that income paid to contractors can be verified through a section 1099.