What This Statute Says
A.R.S. § 42-11132.01 exempts property that is leased to a church, religious assembly, or religious institution from Arizona property tax. The lease must be long-term and the property must be used for religious purposes.
2. Is the sole economic beneficiary of the classification of the property as class nine pursuant to section 42-12009, subsection A, paragraph 5.
A.R.S. § 42-11132.01The leased-to-church exemption parallels the leased-to-school rule in § 42-11132. A private owner can lease a building to a religious organization and claim the property tax exemption on the leased property as long as the religious use is documented.
For estate planning that includes investment real estate leased to a religious organization, the exemption may significantly affect the property's net income and therefore its valuation.
When This Statute Comes Into Play
This statute typically becomes relevant in three situations. A property owner is reviewing an annual tax bill. An estate is being administered and the personal representative has to address ongoing property tax obligations. Or a charitable or nonprofit organization is claiming or maintaining an exemption. The statute is part of a larger framework in chapter 11 of title 42 and operates alongside the related sections cross-linked below.
What This Means for Arizona Families
Most families never think about Arizona property tax statutes until they are sitting at a closing table on an inherited home, reviewing an unexpected tax bill, or trying to claim an exemption for a surviving spouse. When that moment arrives, the rules in chapter 11 of title 42 are the framework you are working inside.
If you are holding real property in a revocable living trust, the trust structure does not by itself remove the property from the tax rolls. The exemption has to come from a specific statute. Our FAQ on what to do with property you inherit in Arizona covers the immediate practical questions, and our FAQ on probate timelines covers how a contested or stalled administration can affect tax filings and exemptions.
If you are administering an estate, the personal representative has a duty to keep property taxes current, to claim available exemptions where appropriate, and to maintain documentation in case the assessor reviews a claim later. Calendar the February exemption filing window each year for any property where a widow, widower, or disability exemption applies. Once the deadline passes, the saving for that year is usually lost.