That's only true if the rent is high enough to cover the property taxes. If competing rentals are priced below the level necessary to cover the taxes, the owner is paying the taxes and taking a loss. My wife rented our 2nd house to a local police officer who was having problems in his household. She priced it at $350/month. The taxes alone were $360/month. The monthly payment to the bank is $750. It's a 2068 sq ft house with 3 br, 1 BA on 1/4 acre. According to the IRS, the median rent for that size house in Bannock county is $825. The IRS provides that data as a "heads up" to owners who aren't charging "fair market" rents and showing a net loss on the rental property to avoid income taxes. The IRS permits a deduction for property tax, mortgage interest, maintenance and depreciation against the gross rental receipts. If the IRS gets hard nosed about requiring rents to be high enough to cover the costs, be prepared for an impact on rents...in the up direction.
actually not always.
In commercial leases the property tax and renter tax is seperatly stated and chaged and if the renter defaults it is converted to rent due and owing.
In residential leases the rent and property taxes are included as seperate clauses in leases where the landlord is astute enough to put it in.
this is important as property taxes may go up and the landlord needs to pass that cost through to the renter.
It is not a question of “covering the cost in the rent” it is a question of drafting the lease to ensure the taxes are paid by the renter.
That's YOUR CHOICE to rent your property at a loss. However, most people rent it at a rate that includes all costs. That was my point. Renters DO PAY property taxes, indirectly.