[RPPTL LandTen] Real Doozy Transient/Nontransient issue

[Harry Heist]

Apartment community rents primarily with 1 year leases decides to do some short term rentals 6 months or less. 

 

Do they have to pay sales/tourist tax?

 

We had a question come in where the party, apartment community,  that has primarily long term rentals and always will, feels that this case cited below means they do not.  

 

If this is true, then sale tax in a situation like this would need to depend upon the "intention of the parties" .  Now there is some case law that states that for the purposes of evictions, a person can’t rent out motel rooms to transients and then just kick them out using 509 but this is a little different. 

 

Here we are talking sales/tourist tax, not eviction.

 

Here are 2 examples which would be true if the interpretation below is correct.

 

Example #1: On vacation for 5 months, have house in NJ, rent apartment I an apartment community for 5 month vacation -- No sales tax

 

Example #2: Sold house and moved from NJ, looking to buy a house, rent an apartment in Florida for 5 months - Sales/Tourist tax due

 

H

 

See below:

 

This court reversed and remanded, Hale v. Department of Revenue, 808 So.2d 237 (Fla. 1st DCA 2002), holding that section 212.03(7)(a) provided a separate exemption from tax where the apartments constitute the “permanent or principal place of residence” of the tenants and that it was not necessary to have leases in excess of six months as required by section 212.03(4) to be entitled to the exemption provided by section 212.03(7)(a)."

 

The court relied in the following:212.03 (7) (a)Full-time students enrolled in an institution offering postsecondary education and military personnel currently on active duty who reside in the facilities described in subsection (1) shall be exempt from the tax imposed by this section. The department shall be empowered to determine what shall be deemed acceptable proof of full-time enrollment. The exemption contained in this subsection shall apply irrespective of any other provisions of this section. The tax levied by this section shall not apply to or be imposed upon or collected on the basis of rentals to any person who resides in any building or group of buildings intended primarily for lease or rent to persons as their permanent or principal place of residence.

 

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