Real Estate News Update: Portland Eliminates Residential Tax Exemption

Individuals Beware!

On June 6, 2012, the Portland City Council amended its Code to remove the exemption allowed for individuals whose sole business activity is renting or leasing less than ten (10) residential real property dwelling units. This change is effective for tax years beginning on or after January 1, 2012.

This change does not impact the Multnomah County Business Income Tax, which at this time still provides for a similar exemption for individuals whose sole business activity is renting or leasing less than ten (10) residential units.

As such, individuals and/or their estates will now be required to pay the City of Portland Business License Tax on any residential rental activity within its jurisdiction. The only exception will be if the individual or their estate has less than $50,000 in total gross receipts from all business activities, both within and outside the City of Portland’s boundaries. This overall gross receipts exemption remains unchanged.

For more information on this change, or if you have any questions about how this change may impact you, please visit the City’s website or feel free to contact a member of our Real Estate Practice Group.

Perkins & Co Real Estate Tax Team

Tim Kalberg, Shareholder, tkalberg@perkinsaccounting.com, 503-221-7511
Brigitte Sutherland, Shareholder,bsutherland@perkinsaccounting.com, 503-802-8613
Kimberly Woodside, Shareholder,kwoodside@perkinsaccounting.com, 503-221-7592
Trina Headley, Tax Senior Manager, theadley@perkinsaccounting.com, 503-221-7593

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