Step-by-Step Guide to Becoming a Landlord in Philly
So, you are looking to turn your home into a rental property or are making the leap into real estate investment. Congrats and be prepared for some paperwork (perhaps, a LOT of paperwork). While the process may seem overwhelming, by following our step-by-step guide, you can call yourself a legitimate landlord in no time.
1) Get Your Business Income & Receipts Tax (BIRT) Account Number
Your first step as a new real estate investor is to file a Business Income & Receipts Tax (BIRT) return through the Philadelphia Department of Revenue. Any individual, corporation, LLC, partnership, or association engaged in for-profit activity within the city of Philadelphia must file a Business Income & Receipts Tax (BIRT) return. Any individual or entity maintaining a Commercial Activity License (CAL), even if not actively engaged in business, must file a BIRT return. Register for free here.
2) Create Your eClipse Account
With eCLIPSE (Electronic Commercial Licensing, Inspections, and Permit Services Enterprise) you can apply for permits, schedule inspections, and request approval from multiple departments at the same time. Have questions about eCLIPSE? The city of Philadelphia provides a handy FAQ section on its website. To register, click here.
3) Get Your Commercial Activity License
You will need a Commercial Activity License via the Philadelphia L&I to do business in the city. This includes businesses that are located outside the city limits that do business in the city. This license links all of your businesses and the legal entity you registered for your Business Income and Receipts Tax (BIRT). You can register online in your eClispe account at no cost.
4) Ensure You are Compliant with the Lead Paint Disclosure and Certification Law
Starting on October 1, 2020, the Philadelphia Department of Health requires landlords operating rental properties in eleven Philadelphia zip codes – regardless of whether they will be renting to children under seven -- to obtain a lead-free or lead-safe certification in order to A) execute a new or renewed lease or B) receive a new or renewed rental license. The remaining zip codes in Philadelphia will be phased in over a two-year period. Landlords in those remaining zip codes will continue during that two-year period to be subject to the current requirement to hold a valid lead certification if children under seven will be living on the premises. Learn more about your responsibilities in this comprehensive Lead and Healthy Home Landlord Resource.
5) Obtain your Housing Rental License
The L&I requires this license of any entity that rents any type of housing unit. Keep in mind, if you own a multi-unit (two or more units,) you will need to gain Zoning Approval. You can register online via your eClipse account for a $55 fee, per unit.
To see how to Complete Your Rental License Form, click here.
6) For Each Time You Rent a Unit, You will Need a Certificate of Rental Suitability
This certificate verifies that the property doesn’t have any L&I violations and is fit and habitable to lease in accordance with all applicable requirements of the Philadelphia Property Code. Note that this certificate must be obtained online no longer than 60 days before your lease start date (there is no cost).
7) Register for the PGW Landlord Cooperation Program
By registering for the PGW Landlord Cooperation Program, you will be notified when PGW is asked to shut off gas, perform service work, or when there is collection-related activity at your property. Properties that are not eligible include commercial/industrial properties, a multi-unit property with a single meter, an owner-occupied property, or properties where the landlord is (or legally required to be) the customer of record. Register here at no cost.
Let Us Help You Find Great Tenants!
Now that you have dotted all the i’s and crossed all the t’s, it is time to find tenants for your new investment property. Count on The Somers Team to help you find the best possible tenants to call your property home. Contact our team today!
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