Colorado House Bill HB1299

Colorado 2024 Regular Session

• Introduced: 2/14/24
• Failed: 4/22/24
• Refer: 2/14/24

Caption

Short-Term Rental Unit Property Tax Classification

Impact

The bill is noteworthy because it seeks to provide clarity and uniformity in how short-term rental properties are evaluated for tax purposes. By classifying these properties explicitly, it aims to assist county assessors in accurately determining tax values. Furthermore, the legislation mandates property owners to submit an annual affidavit concerning the rental status of their properties, ensuring compliance and aiding in proper classification. This process aims to mitigate potential abuses of the current tax structure, where properties could be misclassified as residential to benefit from lower tax rates despite functioning as commercial rentals.

Summary

House Bill 1299 aims to define and classify short-term rental units in Colorado for property tax purposes. It distinguishes between residential properties and commercial short-term rental units, with the latter classified under nonresidential property, akin to lodging establishments like hotels and motels. This classification is essential since it directly affects how property taxes are assessed and collected for these rental units, leading to potential disparities in tax obligations among property owners. The bill addresses the growing prevalence of short-term rentals in the state, influenced significantly by internet hospitality services, thereby indicating a shift in housing utilization.

Contention

There is a potential contention surrounding HB 1299 due to the perceived impact it may have on both homeowners and the local housing market. Critics may argue that the bill could exacerbate housing shortages by emphasizing the commercial use of residential properties. Supporters, however, might contend that clearer regulations and stricter classifications could lead to more equitable tax obligations and a more stable housing market by preventing the conversion of large numbers of residential units into high-yield short-term rentals. Discussions about the necessity and implications of the bill reflect broader concerns regarding housing affordability and availability in Colorado communities.