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Tax basics for short-term rental hosts
General information, not advice. Rules and situations differ from place to place and from one property to the next. Check with the office, insurer or tax professional who governs your own case.
Two kinds of tax usually touch a short-term rental: taxes on each stay, which you may need to collect from guests, and income tax on what the rental earns you.
Taxes on each stay
- Most states and many towns tax short stays the way they tax hotels — sales tax, lodging tax, tourism tax, or several of them.
- Some booking platforms collect and send certain of these taxes for you. Bookings you take directly — on your own website or by phone — are usually yours to collect and report.
- You may need a sales tax license or lodging tax account before your first stay. Our rules by place pages note what official sources state for the places we cover.
Income tax
- In the U.S., the IRS explains how rental income and expenses are reported in Publication 527, Residential Rental Property, including rules for homes you also use yourself.
- Publication 527 says that if you use a dwelling unit as a home and rent it out fewer than 15 days in the year, you don't report that rental income.
- It also explains that if you provide substantial services mainly for the guest's convenience — such as regular cleaning, changing linens or maid service — the income is reported differently than ordinary rent. Ask your tax professional which form fits your rental.
- Expenses such as cleaning, supplies, utilities, insurance, platform fees and repairs are generally tracked against rental income. Your tax professional will tell you what you can deduct.
Keep records as you go
- Keep each stay's gross amount, the fees taken out, the taxes collected, and what reached your bank account.
- Keep receipts for every expense, sorted by property.
- Track the days you or your family use the place.
Keeping the books
If you'd rather keep the books yourself, Rental Books — made by the same family of companies as this site — splits each stay into platform fees, cleaning, management, taxes and your net, and prepares a year-end pack for your CPA. Find more under money side.