San Francisco Vacancy Tax: Suspension, Rules, and Exemptions

San Francisco’s vacancy tax on housing — officially the Empty Homes Tax, passed as Proposition M in November 2022 — is not being enforced right now. A San Francisco Superior Court ruling in October 2024 declared it unconstitutional and blocked the city from collecting it. The city is appealing. If you own residential property in a building with three or more units, you don’t need to file or pay for the 2024 tax year, but you should keep vacancy records in case the ruling is reversed. A separate commercial vacancy tax is still active and still requires annual filing.

Is the Tax Being Collected Right Now

No. On October 31, 2024, the San Francisco Superior Court ruled that the Empty Homes Tax violates the federal and state constitutions and is preempted by California law. The court entered judgment on November 26, 2024, and prohibited the city from enforcing or administering the tax as of December 6, 2024.¹

Property owners do not need to file or pay by the original April 30, 2025 deadline, or any later deadline, unless the trial court’s decision is reversed on appeal. The Office of the Treasurer and Tax Collector has stopped all collection work related to the tax.¹

The city plans to appeal. If an appellate court reinstates the tax, it could apply retroactively to the 2024 tax year and forward. That’s the reason to keep vacancy and occupancy documentation now rather than try to reconstruct it later.

Which Buildings Would Be Covered

The tax reaches residential units in buildings with three or more separate units. Single-family homes and duplexes are not subject to the tax.²

Hotel rooms and other units used for short-term transient occupancy are excluded as long as they are properly permitted for that use. Mixed-use buildings can fall under the tax for their residential portions, so owners should look at whether the residential unit count by itself crosses the three-unit line.²

What Counts as Empty

A unit is “empty” if it goes unoccupied for more than 182 days in a calendar year. Those days don’t have to be consecutive. Short gaps between tenancies add up across the year toward the total.²

Occupancy generally means someone is living in the unit as a primary resident or as a lawful tenant. The Tax Collector can require the owner to produce evidence, which may include a valid lease or rental agreement, utility usage records, or voter registration tied to the address.²

The burden sits on the owner to prove occupancy, not on the city to prove vacancy. Signed leases and utility bills showing consistent usage are the cleanest proof. Without them, owners often struggle to meet the standard during an audit.

How Much the Tax Would Be

Rates scale with unit size and with how many consecutive years the unit has been empty. For the first year of vacancy:

Under 1,000 square feet: $2,500
1,000 to 2,000 square feet: $3,500
Over 2,000 square feet: $5,000

A second consecutive vacant year doubles those amounts:

Under 1,000 square feet: $5,000
1,000 to 2,000 square feet: $7,000
Over 2,000 square feet: $10,000

From the third consecutive year on, the rates double again:

Under 1,000 square feet: $10,000
1,000 to 2,000 square feet: $14,000
Over 2,000 square feet: $20,000

The dollar figures are adjusted each year by the Consumer Price Index for All Urban Consumers for the San Francisco area, so they rise with inflation.² A large unit kept empty for three straight years would owe $35,000 cumulatively before any inflation adjustment.

Exemptions

Several categories of units are not subject to the tax even if they sit empty past 182 days.²

A unit occupied as the principal residence of the owner or a tenant.
Units owned by a government entity or by a nonprofit providing affordable housing.
Units made uninhabitable by active construction or repair, if the owner has all required permits and is actively pursuing completion.
Units in newly constructed buildings, during a one-year lease-up period after the certificate of occupancy is issued.
Vacancies caused by the death of an owner or by a catastrophic event like a fire or earthquake, with documentation.

The construction exemption is where disputes are most likely. “Actively pursuing completion” is the key phrase. Pulling a permit and then letting the project stall doesn’t qualify; the city expects real progress, not a permit held as a shield.

Filing If Enforcement Resumes

Under normal operation, every owner of a building with three or more residential units would file a return with the Office of the Treasurer and Tax Collector affirming whether each unit was vacant for more than 182 days in the prior calendar year. The original filing deadline for the 2024 tax year was April 30, 2025.¹

That deadline is suspended indefinitely because of the court ruling.¹ If an appellate court reinstates the tax, late filing and late payment would likely trigger administrative penalties and interest on top of the base tax, so watch the appeal.

The Commercial Vacancy Tax Is Separate

Don’t confuse the two. San Francisco also imposes a Commercial Vacancy Tax on certain commercial spaces that stay empty for more than 182 days in a calendar year. It’s a different tax under a different article of the city code (Article 29, versus Article 29A for the residential Empty Homes Tax), with different rates, exemptions, and filing rules.

The commercial tax is active and being enforced. Owners, tenants, and subtenants of taxable commercial space must file a return every year, even if the space qualifies for a vacancy exemption. The filing deadline for the 2025 tax year is March 2, 2026.³ The court ruling against the residential tax has no effect on commercial obligations.

1
Treasurer & Tax Collector. Empty Homes Tax (EHT)
2
San Francisco Department of Elections. San Francisco Business and Tax Regulations Code Article 29A
3
Treasurer & Tax Collector. Commercial Vacancy Tax (CVT)