How do property taxes work for rental properties?
By Bob Millaway, South Jersey Community Expert & REALTOR®
Rental properties are assessed and taxed the same way as owner-occupied homes, based on the property's assessed value and the local tax rate. The key difference is that property taxes on rental properties are considered a business expense and are fully tax-deductible against rental income. Higher tax bills reduce your net rental income, which can affect your decision on rent pricing.
Why It Matters
Property taxes are one of your largest operating expenses as a landlord. Understanding how they affect your bottom line helps you price rent appropriately and maximize your investment returns.
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