Prohibiting counties from double-taxing rental properties

2026 Regular Session Introduced by Joe Funkhouser and 1 co-sponsor

The bill requires counties and municipalities to tax residential rental properties at the same rate as owner-occupied homes and bans zoning-based tax increases.

To House Finance

#realandpersonalproperty #taxation

Purpose and Intent

HB 5532 aims to prohibit counties and municipalities in West Virginia from double-taxing residential rental properties.

The stated goal is to lower rent for tenants by ensuring rental properties are not taxed at rates higher than owner-occupied housing and by preventing additional taxes based on zoning.

Key Provisions

§11A-5-1 — Purpose

Legislative finding: Lowering rent is a priority.

The bill asserts that landlords can keep rental costs affordable only if properties are not double-taxed by local governments.

§11A-5-2 — Taxation on Rental Properties by Counties and Municipalities

(a) Tax rate parity: Taxes assessed on owners of residential rental properties by counties or municipalities must be at the same rate as if the property were owner-occupied housing. In other words, no higher tax rate should apply solely because the property is rental.

(b) Zoning-based taxation ban: No county or municipality may assess additional property taxes on residential rental properties based on zoning classifications.

(c) Clarification: The article does not alter the assessment of sales and service taxes for business purposes under existing code provisions (§§11-15-1 et seq.).

§11A-5-3 — Promulgation of Rules

The WV Tax Commission (implied by “the commission”) may adopt rules necessary to implement the article.

Rules must include procedures for changing real property assessments and the forms used to classify properties for future reporting.

Any rules exempted from the requirements of Chapter 29A must be filed with the Legislative Rule-Making Review Committee before October 31, 2026.

Scope and Effects

Who is affected: Counties, municipalities, property owners of residential rental properties, and potentially tenants (via changes to rent dynamics).

Primary impact: Prevents local governments from imposing higher taxes or additional taxes on rental properties solely due to their rental status or due to zoning, aligning them with owner-occupied tax rates.

Exclusions: Sales and service taxes on businesses remain governed by existing law and are not altered by this bill.

Procedural and Timeline Aspects

Status: Introduced February 16, 2026; referred to the House Finance Committee.

Action history: Filed for introduction and sent to Finance; introduced in the House (HB 5532).

Rulemaking timeline: The Commission must file any exempt rules with the Legislative Rule-Making Review Committee by October 31, 2026.

Potential Impacts and Considerations

Could reduce local tax revenue derived specifically from rental properties if local assessments previously treated rentals more heavily due to their status.

May influence housing affordability by stabilizing or lowering rent pressure if tax savings are passed through to tenants.

Implementation depends on rulemaking by the WV Tax Commission and potential updates to property assessment classifications and reporting forms.

The bill does not address other taxes (e.g., city or county income or business taxes) beyond property taxes on residential rentals.

Bill