Resident Status Effects Your Property Value

How Residency Status Impacts Property Value. If you had originally purchased your property as a second home and now it is your primary full-time Arizona residence, take note! You’ll want to verify that your residency status has been updated at the county level, as it could be costing you thousands in extra property taxes.

In Arizona, the legal property class distinction between 4.1 part-time and 3.1 full-time residents plays a crucial role in determining the Limited Property Value (LPV) of a property. Let’s delve into the explanation:

Legal Property Classes:

4.1 Part-Time Residents: Part-time residents typically spend a portion of the year in Arizona. This legal property class is applicable to individuals who do not reside in the state for the full year. It may include seasonal residents or individuals who use the property as a second home.
3.1 Full-Time Residents: Full-time residents are those who reside in Arizona throughout the entire year. This class includes primary homeowners and individuals who consider Arizona as their permanent place of residence.

Note that in order to change your status you will need to complete an appeal form and you will be required to submit documentation to support your status as a full-time resident. This can include:

Driver’s License showing resident’s name, property address, and date issued January through July of the oldest year on the claim you want to change.
Voter Registration Card showing resident’s name, property address, and dated January through July of the oldest year on the claim you wish to change.
Income Tax Document (Resident’s name, property address & tax year section only)
Motor Vehicle Registration or utility bill (gas, water, electric) for each year you are asking for on the claim.

The form may be found at Legal Classification Change Real Property Instructions.

Determining Limited Property Value (LPV):

The Limited Property Value (LPV) is a key factor in determining property taxes in Arizona. The Legal classification of property owners into 4.1 or 3.1 directly influences the calculation of LPV.

In the above example, you can see in 2023 LPV is $530,887 as a 4.1 part-time resident vs $367,430 as a 3.1 Full-time resident status. You could save thousands come tax time.

Recommendations for Homebuyers:

If you originally purchased your property as a second home in AZ and now it is your full-time residence you should update your status with the Maricopa County assessor office. It could save thousands on your property tax bill.

Check your Legal Properties Class on the Maricopa County Assessor website. Simply add your address to the main search bar. Once your property appears click on the ANP and mid-way down will show your Valuation Information and Legal Class.