Should renters send a separate check for the taxes? No tax would be due for your long-term tenant, nor would you need to file a return for the months of the long-term tenancy. Lease contracts should include provisions that all state and local taxes and fees are due as of the date of occupancy, so occupants are aware that additional amounts may be due if rate or fee changes occur after a contract is signed. Check with your insurance agent to be sure that you have adequate insurance coverage. If the operator does not provide this identifying information, you may not allow the operator to list their rental property with you. Want to be sure I capture all of this information correctly. And yes, you should simply add a line item in your lease for the Lodging Tax under the payments section. https://www.mass.gov/info-details/room-occupancy-excise-tax, Jennifer DeSimone, Constituent Services Manager on this new law
By separate vote, cities and towns may choose to include 2-family and 3-family dwellings that include the operators primary residence. Hi, Barbara, unfortunately, if your home is in one of the 15 towns on the Cape (or their villages), you will be subject to the Wastewater tax regardless of whether you are on town water/sewer. Short-Term Lodging Tax Percentage by Town. So that wont help you avoid the tax. a property that qualifies for the exemptio, Provide an intermediary with your registration information, If you use an intermediary to rent your property, you must provide them with your registration certificate information. Your short-term tenants would pay a tax, and you would remit the tax for those months. I think it would be helpful for everyone involved. Taxable items include the rent and any other non-refundable charges, including cleaning, linen, or pet fees. Are you at We Need a Vacation going to be required to provide a list of all your active accounts to the Comm. Collecting the 2.75% Cape Cod & Island Water Protection Fund Excise on hotel rooms in Barnstable County booked prior to January 1, 2019 for occupancy on July 1, 2019 or after, Planning for changes in local excise rates, Generally, the tax rates in effect at the time of occupancy apply to all rentals subject to room occupancy excise. The term rent includes all optional charges, including but not limited to insurance, linen fees, cleaning fees, and booking fees. Very good point, David! The state excise and any local option excise, including the Convention Center Financing fee, the new Cape Cod and Islands Water Protection Fund excise, and any community impact fee are to be paid with the return. You will only need to register one time. HomeAway, for example, only gives the insurance coverage to rental transactions that go through them. Copyright 2022. All operators and intermediaries must register with DOR on MassTaxConnect. It does not include property that is rented out through tenancies at will or month-to-month leases.
We also have our home listed on your site, and would love to get a copy of the your sample lease agreement as well if possible. tax lodging cod cape does New Advance Payment Requirement for Vendors and Operators in G.L. For more information, visitNew Due Date for Sales and Use Tax Returns.
Note that while the statute provides for a 5% rate, an uncodified surtax adds .7% to that rate. Beginning July 1, 2019, the room occupancy excise also applies to short-term rentals of property for 31 days or less.
Generally, the tax rates in effect at the time of occupancy apply to all rentals subject to room occupancy excise. DOR maintains a current listing of all local rates and fees, called the Municipal Databank. You continue to be an incredible resource with the wealth of information you provide. No, Rick, you were correct initially. What specifically do I make a payment for on the 30. ) or https:// means youve safely connected to the official website. We have a septic and our own well.
Specifically excluded from rent are: A short-term rental is an occupied property that is not a hotel, motel, lodging house or bed and breakfast establishment, where at least one room or unit is rented out by an operator through the use of advance reservations. The total amount of tax required to be collected depends on where the property is located. Am I required to carry insurance for my home? Joan.
Created by WeNeedaVacation.com. No, if you had no taxable rentals during the previous month, you do NOT need to log in and file a 0 payment. Since then, Joan replied to you by email, and for the sake of other readers, heres what she wrote: Generally, a real estate agent works for a real estate brokerage or company and any rent associated with a listing by a real estate agent is collected by the company. An intermediary can arrange a property rental and collect rent for any operator whether they operate a bed and breakfast establishment, hotel, lodging house, short-term rental or motel. The only month for which you need to file are those in which you had one or more taxable rentals. Short term refers to any rental period of 31 days or less, so annual or long-term rentals are excluded from the tax. Beginning July 1, 2019, for short-term rentals only, cities and towns are permitted to charge an additional. Would you be so kind as to clarify what the correct procedure is? This is why WeNeedaVacation.com has never been against THIS PART of the Lodging Tax bill. We now provide this language on all listings: State and local taxes of X% will apply. The exact percentage is determined by the town in which your rental home is located. Registration for operators with short-term rental properties that are rented for more than 31 days, Register as an intermediary or operators agent, An intermediary or operators agent must register with DOR using. Hi Rick, Your question is an interesting one and one that Im not sure the DOR addresses. Operators may find that intermediaries require registration information regardless of the term of the short-term rental. You are exempt from the tax if you rent your home for 14 days or fewer per calendar year. And finally, our subscription rates are considerably below any of those charged to homeowners by the Big Box sites. I do however have two leases that were signed this year and will have to collect and pay the new tax on those contracts: if we choose to no longer rent our home going forward do we still have to register to pay the small amount of tax on these remaining two taxable leases or can I send in the tax due regardless? Hi Joan, Room occupancy returns are due monthly on or before the 30thdayfollowing the month represented bythe return. When you file your monthly tax return, you will list each property and the rent collected for that property. Include the operators registration certificate number on your return. Just wondering if when you say collecting the lodging tax as a separate fee that means that we need to request a separate payment from the renter for the amount of the taxes or if we can accept a single payment that includes both rental fees and tax? These policies are included with the rental and satisfy the law as I am being told. What if I rent my home by the week in the summer but long term (formore than a monthto one party)in the winter? Hi my lease is split 7 days in August and 25 days in November for a total of 32 days to the same guest. I only rent my If the rental week for a single renter starts the end of August and continues a couple of days into September, how do we report that rental income for the month? This is not effected by the possible refundable cleaning costs. How does that affect my tax collection responsibilities? If I didnt have any taxable rentals during the previous month, do I still need to file with MassTaxConnect? You can enter information for one property or you can upload a consolidated return for multiple properties using Excel. Thanks for the clear information! The 14-day-exception is determined on a per-property basis every year. If so, do you have to provide this list AFTER July 1? A town can assess an additional 3% Community Impact tax if the homeowner owns more than one rental home in the same town. You skipped the table of contents section. The deadline for claiming the exemption for each calendar year is January 15 of the year claiming the exemption. If your guests are exempt from the Lodging Tax due to your only renting for 14 days or less per year, please let us know so that we can update your listing accordingly. In such cases, it is the responsibility of the company to register as an intermediary and file returns on behalf of its agents for all the properties that any of its agents list for rent. How can I determine what amount my town is assessing for the local tax? Note that intermediaries who already use MassTaxConnect do not need to re-register. BOB on Nantucket. And that is their final answer. (I asked them twice just to be sure.). If you were to block a week off on your HomeAway calendar for a booking you got through another source, that booking would not be covered by the insurance. What if I rent my home by the week in the summer but long term (formore than a monthto one party)in the winter? However, if the property is rented for 14 days or less in a calendar year, you are not required to collect any tax. We have the tax listed in the lease based on the rental cost. An intermediary includes a broker, hosting platform, or operators agent. We have no idea what the repercussions are for not registering or paying the tax. If no tax is due, no return is required to be filed. As of July 1, 2019, new rules require an intermediary or other agent collecting rent to file returns and pay taxes to DOR. If there is no separate legal entity that owns the property (a partnership, trust, LLC, etc.) Operators should be aware that cities and towns may have separate registration or licensing requirements. Dept. Hi Elizabeth Thank you. You can just add line items to it, including one for the Lodging Tax.
No. A bed and breakfast home is defined as a private owner-occupied house where not more than 3 rooms are rented, a breakfast is included in the rent and all accommodations are reserved in advance. occupancy Payment can be made by electronic transfer from your checking or savings account. 
The 14-day-exception is determined on a per-property basis every year. This form only gathers feedback about the website. Is We need a vacation going to add it somewhere in the calendar section or on their main home page? Thanks! Good question, Sal!
of RevenueFAQs web page:
Are we to tax the security deposit up front (along with the rent and non-refundable fees)? I have read several references to the act of registering your rental with the state. The amount must be greater than $0. You will find your certificate number after registering by logging into your MassTaxConnect account, selectingView Operators Properties from the Room Occupancy Consolidated tax type and choosing the View Certificate hyperlink. Intermediaries are also required to provide a notice to operators within 30 days of filing a return with DOR that details the amount of rent collected with each occupancy as well as the taxes and fees they have collected and remitted to the Department. They will log in under their existing username and password and add the Room Occupancy Consolidated account type. Individual agents only need to register and file returns if they are independent agents not affiliated with any company and collect rent directly. Instead, intermediaries will log in under the existing username and password and add the Room Occupancy Consolidated account type. Hi, Lisa, like in a hotel stay, the tax is based on the check OUT date of your guest, and therefore due by the 20th of the following month. If you cant provide a tax return or refund amount, call the Trustee Tax Contact Center at (617) 887-6367 (choose #3 for Business tax, then #2 for Trustee Taxwhen prompted). Hi, John, the tax INCLUDES any non-refundable fees such as cleaning, linens, or pet ones. Beginning July 1, 2019, the room occupancy excise also applies to. I dont believe so, the tax is against any non-refundable fee charges. It is the responsibility of the intermediary to notify the operator of its responsibility to comply with all applicable municipal, state and federal laws. There are two options. Sorry! What specifically do I make a payment for on the 30th of the month? Towns may implement a health and safety inspection requirement and determine the frequency of the inspection. Without it, DOR may ask the intermediary to remove the property from their listings. If I currently charge $2500 in rent and $125 in cleaning fees, can I change the rent to $125 and the cleaning fees to $2,500 and avoid most of the tax? You can find more information about how to report and remit amounts collected in response to local rate changes in the, Amounts paid by an occupant that were previously reportedby the operator as taxable gross receipts for sales or use tax purposes. No matter how many days your property is available for rent each year, you must register with DOR usingMassTaxConnect. Exempt rents should generally be included in line 1, total rent, but not included in line 2, taxable rent. The owner who registers as the operator will file returns and remit the tax to the Department if the owners are collecting rent directly. Seea list of the townsthat currently require registration. The new law requires homeowners to maintain $1 million dollars in liability insurance to cover a rental home. I would also appreciate a copy of your lease. Ms Weedon
The taxes remitted would include state excise and any local option excise, including the 2.75% Water Protection Fund excise. Although operators have until January 15 to claim or renew a 14-day rental exemption for the calendar year, if the operator does not claim the exemption by that date for a property, it will be the responsibility of the intermediary or operators agent to collect sales tax on that rental as of January 1. The states room occupancy excise tax rate is 5.7%. Is the tax only for rentals less than x days? The email I just received from We Need a Vacation. Whether by check or credit card, the taxes could be combined. An operator is required to keep records relating to charges and receipts for all transfers of occupancy, as well as copies of returns filed. Check with your town for details. Hi, Marie, Im not sure exactly what youre asking, but I think this information from the top of the FAQs might help: The tax went into effect on January 1, 2019. We will use this information to improve the site. Some towns have voted to increase the local tax or add a fee. (See a link to the how-to tutorial videos below.). Operators do not report or pay taxes and fees on rent amounts collected by an intermediary. How does that affect my tax collection responsibilities? Intermediaries will register just once. Hi, Bob, unfortunately, no.
Thank you, If you collect the funds for your rental, you will have to keep track of the tax, set it aside, and remit it to the state at a later date. 
What a pain the law is making us change/add to insurance policies FYI, my insurance broker, who also has a rental on the Cape, said there are many options & one of the easiest (if my out of state primary residence insurer will allow) is an umbrella policy on the primary residence to make up the difference up to $1 mil liability on the rental property. 8:30 a.m.4:00 p.m., Monday through Friday, Text of the law: You register via the websiteMassTaxConnect. Your guests are exempt from the tax as long as you rent for 14 Days OR LESS, not less than 14 days. Once you have set up your account password: Registering and collecting tax for a property that is rented for only a few days a year as a short-term rental, No matter how many days your property is available for rent each year, you must register with DOR using.
As soon as we find out, we will update that information in the Lodging Tax FAQs post. In the cities of Boston, Worcester, Cambridge, Springfield, West Springfield, and Chicopee, an additional 2.75% tax is chargedfor convention center funding. Its thoughtful expressions of appreciation like yours that make what we do gratifying and worthwhile! Changes to local option rates and fees require a vote by the legislative body of the city or town. The info regarding the lodging tax payment due August 20th notes, in pertinent part: Even if you have no taxes due for July, log into your account and indicate 0 taxes due. Twelve? How much is the tax? A bed and breakfast establishment, as defined above, requires registration with DOR. For tax returns filed by either an operator or an intermediary, the Certificate number ensures that the taxes collected are distributed to the proper localities or special funds. And, yes, you should probably use a lease for regular long-term rentals rather than one for STRs. The other sites, and realtors as well, collect the funds as well as service fees from vacationers and are directly involved in the rental transactions.
Hi, David, You can find more information on specific records to be kept by reviewing the, Responsibilities other than filing returns and paying taxes for intermediaries, The Division of Local Services has compiled. An official website of the Commonwealth of Massachusetts. A short-term rental unit may be considered professionally managed for this purpose whether or not an intermediary is involved. However the law seems to be pretty clear that An intermediary that enters into a written agreement with the operator to collect rent or facilitate the collection or payment of rent on behalf of the operator of an accommodation subject to the excise under this chapter shall assess, collect, report and remit the excise .
Beginning July 1, 2019, for short-term rentals only, cities and towns that have adopted a local excise may vote to charge an additional community impact fee up to 3% on the following types of property: For traditional lodgings (bed and breakfast establishment, hotel, lodging house or motel) the date of booking is not important. If we are not on town sewer, do we pay a wastewater tax? Now the DOR is saying that we do not have to go into our account at all if we did not collect tax for a given month. Any lease signed on or after this date for a rental term beginning July 1, 2019, or later must include the rental tax. So any leases you sign from now on for occupancy in your home starting July 1, 2019, or beyond are subject to the new tax. Can we expect this site to do the same? Nantucket and the Vineyardare notcurrentlypart of the Cape Cod and Islands Water Protection Fund. A bed and breakfast home is not subject to tax. We also do not charge vacationers a service fee to use our site, and, because the booking transactions are not done through us, there is no fee charged for processing any payments. You can find more information about how to report and remit amounts collected in response to local rate changes in the regulation. Do not include sensitive information, such as Social Security or bank account numbers. Or do you think the tax applies only to security deposits that arent returned after the stay because of damage?
Do not use your ROC account number. Payment of the tax must be online, and the only way to submit it is to log in to the account that is created when you register. Alodging house or establishment is where lodgings are rented to four or more persons unrelated to the operator. Do Marthas Vineyard and Nantucket require collection of the Wastewater Tax? Top-requested sites to log in to services provided by the state. Registering as an intermediary or operators agent if you have multiple clients who are operators, Confirming operator registration as an intermediary, Aside from the limits on the length of a rental (90 days or less for traditional lodgings, 31 days or less for short-term rentals), there are a number of other exemptions to the excise. Jeff and I are proud to have two of our three grown children working for WeNeedaVacation.com, truly a family-run business. What if a town increases its local excise rate or imposes a new fee? We are now all considered businesses and as such need to purchase a up to 3% if an operator has more than one property in that locality or is renting an owner-occupied 2 or 3 family house on a short-term rental basis. If you would like to continue helping us improve Mass.gov, join our user panel to test new features for the site. Elizabeth. Warm regards, Rebecca Hansen, Thank you, Rebecca! All operators must register with DOR and obtain a Certificate of Registration for each property they offer for rent. Do I have to file a return even if I have no rental every month? We would be lost without your organization.
So, one of my guests, rents for 28 days in June, which I price relatively low ($200 less than my Summer Rate) It looks like she would be better off next year to rent for 32 days. If during the calendar year, you exceed 14 days of rentals, you will be responsible for paying the taxes that should have been collected for the first 14 days. However, if the property is rented for 14 days or less in a calendar year, you are not required to collect any tax. Would you like to provide additional feedback to help improve Mass.gov? falmouth rental vacation cod cape mile1 10min lounge yard walk town play So including rent, cleaning fee, etc., but not including a returnable security deposit. To register, go to this registration page. No, Kathleen, only rentals that BEGAN on July 1 or afterwards are subject to the tax.
The state will retain its 5.7% and remit the balance to your town. Local rates and fees must be added to the states room occupancy rate and reported together to the Department of Revenue on the same return. Lucky you! Perhaps it is there and I am just not A short-term rental includes an apartment, house, cottage, and condominium. So, you can choose to either tax it and return the tax along with the deposit or not tax it and take your chances that you wont need to withhold any of it. Many thanks for all you do! Even agents do not realize that insurance companies will refuse to pay claims if it involves a short term rental and the policy is a traditional homeowner policy. Could you send a sample lease to me? The state excise and any local option excise, including the Convention Center Financing fee, the new Cape Cod and Islands Water Protection Fund excise, and any community impact fee are to be paid with the return. If, however, you use an intermediary a realtor, property manager, or one of the large booking sites and they collect your funds for you, then THEY are responsible for collecting and remitting the tax for you.
Select the Room Occupancy Consolidated Account. Intermediaries will register just once. A return is only required to be filed for a month that tax is due. An operators agent includes a property manager, property management company, or real estate agent. Currently this applies for all Barnstable County municipalities. Homeowners would be required to cover the cost of the inspection. For all types of rentals, as of July 1, 2019, the total amount of rent that is subject to tax includes all amounts collected by an operator or intermediary from an occupant, in exchange for occupancy. An operator can be an owner, lessee, sublessee, holder of a mortgage, licensee, or anyone else operating a short-term rental. The only month for which you need to file are those in which you had one or more taxable rentals. Was wondering if someone may have a sample lease showing all of the new line items for these charges included? Operators may want to include provisions in lease contracts stating that all state and local taxes and fees are as of the date of occupancy so occupants will be prepared for possible increases due to rate or fee changes after a contract is signed. You can find information about local rules, including whether a city or town is a member of the Cape Cod and Islands. Short term refers to any rental period of 31 days or less, so annual or long-term rentals are excluded from the tax. A bed and breakfast establishment is a private owner-occupied house where 4 or more rooms are rented, a breakfast is included in the rent and all accommodations are reserved in advance. An operators agent is anyone who manages a property for rent or books reservations of a property for rent. desimonej@dor.state.ma.us It is truly appreciated. Note that operators who already use MassTaxConnect do not need to re-register. Intermediaries must also make sure the operator they are working for is registered with the Department before collecting any rent from theoccupant. I have heard that for 14 days, I am exempt, Note that intermediaries who already use MassTaxConnect do not need to re-register. You will be asked to provide one of the following: A tax refund amount from one of your pastthreePersonalIncome Tax returns. Although only one owner can register, file returns and remit tax, each owner remains responsible for ensuring that the proper amount of tax is collected and remitted. When: as of April 1, 2021, the tax is due to the state viaMassTaxConnectby the 30th of the month after your guests departures.
While registration is not required under these circumstances, operators will then be in compliance in the event their short-term rental property is rented for a period of 31 days or less. What if a town increases its local excise rate or imposes a new fee? There seems to be some confusion about the 14 days. When and how do I remit the tax? A lock icon ( For all types of rental accommodations, if the total amount of rent is less than $15 per day, no tax is due. Anyone else able to share what you are doing for insurance liability coverage? On line 2, taxable rent, do not include exempt rent from pre-January 1, 2019contracts. The MA Department of Revenue offers a clear and helpful FAQs page with information about registering as an operator. (Note: that is what you are, an Operator.). The coverage is required to defend and indemnify the owner and any tenants in the home for bodily injury and property damage. It also does not include time-share property or bed and breakfast homes (see definition of bed and breakfast). Rents collected and reported by an intermediary are not considered exempt rents for the operator. Hi, Duane, Short term refers to any rental period of 31 days or less. The tax is the total of these taxes: Are there any exemptions to the law? All taxes and fees that are effective on July 1must be collected for occupancies on or after July 1, including the Cape and Island Water Protection Fund Excise. Nantucket mayopt into the Trust by majority vote of town meeting. Cities and towns are required to notify DOR of any rate or fee changes using the notification of acceptance forms for room occupancy and community impact fee. The exemption renewal process must be completed no later than January 15 of the calendar year claiming the exemption. Thanks so much,
seeing it. It is necessary for all of us to register online and pay by logging in to your account with the DOR online. Check with local officials in the city or town in which the property is located to find out more. Toll-free in Massachusetts (800) 392-6089 We have updated our FAQs with this item: Like operators, intermediaries are required to keep records related to amounts collected and provide those records to the Department upon request. Is this exempt from the tax? Your town may also require a separate registration and registration fee. A return is required to be filed only for any month when tax is due. If you do withhold any of it, you will be responsible for paying the tax on the amount you withhold. then you would register as an individual. Please provide information on how to register a short-term rental property with the state. See below. Cities and towns are required to notify DOR of any rate or fee changes using the notification of acceptance forms for, .
By separate vote, cities and towns may choose to include 2-family and 3-family dwellings that include the operators primary residence. Hi, Barbara, unfortunately, if your home is in one of the 15 towns on the Cape (or their villages), you will be subject to the Wastewater tax regardless of whether you are on town water/sewer. Short-Term Lodging Tax Percentage by Town. So that wont help you avoid the tax. a property that qualifies for the exemptio, Provide an intermediary with your registration information, If you use an intermediary to rent your property, you must provide them with your registration certificate information. Your short-term tenants would pay a tax, and you would remit the tax for those months. I think it would be helpful for everyone involved. Taxable items include the rent and any other non-refundable charges, including cleaning, linen, or pet fees. Are you at We Need a Vacation going to be required to provide a list of all your active accounts to the Comm. Collecting the 2.75% Cape Cod & Island Water Protection Fund Excise on hotel rooms in Barnstable County booked prior to January 1, 2019 for occupancy on July 1, 2019 or after, Planning for changes in local excise rates, Generally, the tax rates in effect at the time of occupancy apply to all rentals subject to room occupancy excise. The term rent includes all optional charges, including but not limited to insurance, linen fees, cleaning fees, and booking fees. Very good point, David! The state excise and any local option excise, including the Convention Center Financing fee, the new Cape Cod and Islands Water Protection Fund excise, and any community impact fee are to be paid with the return. You will only need to register one time. HomeAway, for example, only gives the insurance coverage to rental transactions that go through them. Copyright 2022. All operators and intermediaries must register with DOR on MassTaxConnect. It does not include property that is rented out through tenancies at will or month-to-month leases.
We also have our home listed on your site, and would love to get a copy of the your sample lease agreement as well if possible. tax lodging cod cape does New Advance Payment Requirement for Vendors and Operators in G.L. For more information, visitNew Due Date for Sales and Use Tax Returns.
Note that while the statute provides for a 5% rate, an uncodified surtax adds .7% to that rate. Beginning July 1, 2019, the room occupancy excise also applies to short-term rentals of property for 31 days or less.
Generally, the tax rates in effect at the time of occupancy apply to all rentals subject to room occupancy excise. DOR maintains a current listing of all local rates and fees, called the Municipal Databank. You continue to be an incredible resource with the wealth of information you provide. No, Rick, you were correct initially. What specifically do I make a payment for on the 30. ) or https:// means youve safely connected to the official website. We have a septic and our own well.
Specifically excluded from rent are: A short-term rental is an occupied property that is not a hotel, motel, lodging house or bed and breakfast establishment, where at least one room or unit is rented out by an operator through the use of advance reservations. The total amount of tax required to be collected depends on where the property is located. Am I required to carry insurance for my home? Joan.
Created by WeNeedaVacation.com. No, if you had no taxable rentals during the previous month, you do NOT need to log in and file a 0 payment. Since then, Joan replied to you by email, and for the sake of other readers, heres what she wrote: Generally, a real estate agent works for a real estate brokerage or company and any rent associated with a listing by a real estate agent is collected by the company. An intermediary can arrange a property rental and collect rent for any operator whether they operate a bed and breakfast establishment, hotel, lodging house, short-term rental or motel. The only month for which you need to file are those in which you had one or more taxable rentals. Short term refers to any rental period of 31 days or less, so annual or long-term rentals are excluded from the tax. Beginning July 1, 2019, for short-term rentals only, cities and towns are permitted to charge an additional. Would you be so kind as to clarify what the correct procedure is? This is why WeNeedaVacation.com has never been against THIS PART of the Lodging Tax bill. We now provide this language on all listings: State and local taxes of X% will apply. The exact percentage is determined by the town in which your rental home is located. Registration for operators with short-term rental properties that are rented for more than 31 days, Register as an intermediary or operators agent, An intermediary or operators agent must register with DOR using. Hi Rick, Your question is an interesting one and one that Im not sure the DOR addresses. Operators may find that intermediaries require registration information regardless of the term of the short-term rental. You are exempt from the tax if you rent your home for 14 days or fewer per calendar year. And finally, our subscription rates are considerably below any of those charged to homeowners by the Big Box sites. I do however have two leases that were signed this year and will have to collect and pay the new tax on those contracts: if we choose to no longer rent our home going forward do we still have to register to pay the small amount of tax on these remaining two taxable leases or can I send in the tax due regardless? Hi Joan, Room occupancy returns are due monthly on or before the 30thdayfollowing the month represented bythe return. When you file your monthly tax return, you will list each property and the rent collected for that property. Include the operators registration certificate number on your return. Just wondering if when you say collecting the lodging tax as a separate fee that means that we need to request a separate payment from the renter for the amount of the taxes or if we can accept a single payment that includes both rental fees and tax? These policies are included with the rental and satisfy the law as I am being told. What if I rent my home by the week in the summer but long term (formore than a monthto one party)in the winter? Hi my lease is split 7 days in August and 25 days in November for a total of 32 days to the same guest. I only rent my If the rental week for a single renter starts the end of August and continues a couple of days into September, how do we report that rental income for the month? This is not effected by the possible refundable cleaning costs. How does that affect my tax collection responsibilities? If I didnt have any taxable rentals during the previous month, do I still need to file with MassTaxConnect? You can enter information for one property or you can upload a consolidated return for multiple properties using Excel. Thanks for the clear information! The 14-day-exception is determined on a per-property basis every year. If so, do you have to provide this list AFTER July 1? A town can assess an additional 3% Community Impact tax if the homeowner owns more than one rental home in the same town. You skipped the table of contents section. The deadline for claiming the exemption for each calendar year is January 15 of the year claiming the exemption. If your guests are exempt from the Lodging Tax due to your only renting for 14 days or less per year, please let us know so that we can update your listing accordingly. In such cases, it is the responsibility of the company to register as an intermediary and file returns on behalf of its agents for all the properties that any of its agents list for rent. How can I determine what amount my town is assessing for the local tax? Note that intermediaries who already use MassTaxConnect do not need to re-register. BOB on Nantucket. And that is their final answer. (I asked them twice just to be sure.). If you were to block a week off on your HomeAway calendar for a booking you got through another source, that booking would not be covered by the insurance. What if I rent my home by the week in the summer but long term (formore than a monthto one party)in the winter? However, if the property is rented for 14 days or less in a calendar year, you are not required to collect any tax. We have the tax listed in the lease based on the rental cost. An intermediary includes a broker, hosting platform, or operators agent. We have no idea what the repercussions are for not registering or paying the tax. If no tax is due, no return is required to be filed. As of July 1, 2019, new rules require an intermediary or other agent collecting rent to file returns and pay taxes to DOR. If there is no separate legal entity that owns the property (a partnership, trust, LLC, etc.) Operators should be aware that cities and towns may have separate registration or licensing requirements. Dept. Hi Elizabeth Thank you. You can just add line items to it, including one for the Lodging Tax.
No. A bed and breakfast home is defined as a private owner-occupied house where not more than 3 rooms are rented, a breakfast is included in the rent and all accommodations are reserved in advance. occupancy Payment can be made by electronic transfer from your checking or savings account. 
The 14-day-exception is determined on a per-property basis every year. This form only gathers feedback about the website. Is We need a vacation going to add it somewhere in the calendar section or on their main home page? Thanks! Good question, Sal! of RevenueFAQs web page:
Are we to tax the security deposit up front (along with the rent and non-refundable fees)? I have read several references to the act of registering your rental with the state. The amount must be greater than $0. You will find your certificate number after registering by logging into your MassTaxConnect account, selectingView Operators Properties from the Room Occupancy Consolidated tax type and choosing the View Certificate hyperlink. Intermediaries are also required to provide a notice to operators within 30 days of filing a return with DOR that details the amount of rent collected with each occupancy as well as the taxes and fees they have collected and remitted to the Department. They will log in under their existing username and password and add the Room Occupancy Consolidated account type. Individual agents only need to register and file returns if they are independent agents not affiliated with any company and collect rent directly. Instead, intermediaries will log in under the existing username and password and add the Room Occupancy Consolidated account type. Hi, Lisa, like in a hotel stay, the tax is based on the check OUT date of your guest, and therefore due by the 20th of the following month. If you cant provide a tax return or refund amount, call the Trustee Tax Contact Center at (617) 887-6367 (choose #3 for Business tax, then #2 for Trustee Taxwhen prompted). Hi, John, the tax INCLUDES any non-refundable fees such as cleaning, linens, or pet ones. Beginning July 1, 2019, the room occupancy excise also applies to. I dont believe so, the tax is against any non-refundable fee charges. It is the responsibility of the intermediary to notify the operator of its responsibility to comply with all applicable municipal, state and federal laws. There are two options. Sorry! What specifically do I make a payment for on the 30th of the month? Towns may implement a health and safety inspection requirement and determine the frequency of the inspection. Without it, DOR may ask the intermediary to remove the property from their listings. If I currently charge $2500 in rent and $125 in cleaning fees, can I change the rent to $125 and the cleaning fees to $2,500 and avoid most of the tax? You can find more information about how to report and remit amounts collected in response to local rate changes in the, Amounts paid by an occupant that were previously reportedby the operator as taxable gross receipts for sales or use tax purposes. No matter how many days your property is available for rent each year, you must register with DOR usingMassTaxConnect. Exempt rents should generally be included in line 1, total rent, but not included in line 2, taxable rent. The owner who registers as the operator will file returns and remit the tax to the Department if the owners are collecting rent directly. Seea list of the townsthat currently require registration. The new law requires homeowners to maintain $1 million dollars in liability insurance to cover a rental home. I would also appreciate a copy of your lease. Ms Weedon
The taxes remitted would include state excise and any local option excise, including the 2.75% Water Protection Fund excise. Although operators have until January 15 to claim or renew a 14-day rental exemption for the calendar year, if the operator does not claim the exemption by that date for a property, it will be the responsibility of the intermediary or operators agent to collect sales tax on that rental as of January 1. The states room occupancy excise tax rate is 5.7%. Is the tax only for rentals less than x days? The email I just received from We Need a Vacation. Whether by check or credit card, the taxes could be combined. An operator is required to keep records relating to charges and receipts for all transfers of occupancy, as well as copies of returns filed. Check with your town for details. Hi, Marie, Im not sure exactly what youre asking, but I think this information from the top of the FAQs might help: The tax went into effect on January 1, 2019. We will use this information to improve the site. Some towns have voted to increase the local tax or add a fee. (See a link to the how-to tutorial videos below.). Operators do not report or pay taxes and fees on rent amounts collected by an intermediary. How does that affect my tax collection responsibilities? Intermediaries will register just once. Hi, Bob, unfortunately, no.
Thank you, If you collect the funds for your rental, you will have to keep track of the tax, set it aside, and remit it to the state at a later date. What a pain the law is making us change/add to insurance policies FYI, my insurance broker, who also has a rental on the Cape, said there are many options & one of the easiest (if my out of state primary residence insurer will allow) is an umbrella policy on the primary residence to make up the difference up to $1 mil liability on the rental property. 8:30 a.m.4:00 p.m., Monday through Friday, Text of the law: You register via the websiteMassTaxConnect. Your guests are exempt from the tax as long as you rent for 14 Days OR LESS, not less than 14 days. Once you have set up your account password: Registering and collecting tax for a property that is rented for only a few days a year as a short-term rental, No matter how many days your property is available for rent each year, you must register with DOR using. As soon as we find out, we will update that information in the Lodging Tax FAQs post. In the cities of Boston, Worcester, Cambridge, Springfield, West Springfield, and Chicopee, an additional 2.75% tax is chargedfor convention center funding. Its thoughtful expressions of appreciation like yours that make what we do gratifying and worthwhile! Changes to local option rates and fees require a vote by the legislative body of the city or town. The info regarding the lodging tax payment due August 20th notes, in pertinent part: Even if you have no taxes due for July, log into your account and indicate 0 taxes due. Twelve? How much is the tax? A bed and breakfast establishment, as defined above, requires registration with DOR. For tax returns filed by either an operator or an intermediary, the Certificate number ensures that the taxes collected are distributed to the proper localities or special funds. And, yes, you should probably use a lease for regular long-term rentals rather than one for STRs. The other sites, and realtors as well, collect the funds as well as service fees from vacationers and are directly involved in the rental transactions.
Hi, David, You can find more information on specific records to be kept by reviewing the, Responsibilities other than filing returns and paying taxes for intermediaries, The Division of Local Services has compiled. An official website of the Commonwealth of Massachusetts. A short-term rental unit may be considered professionally managed for this purpose whether or not an intermediary is involved. However the law seems to be pretty clear that An intermediary that enters into a written agreement with the operator to collect rent or facilitate the collection or payment of rent on behalf of the operator of an accommodation subject to the excise under this chapter shall assess, collect, report and remit the excise .
Beginning July 1, 2019, for short-term rentals only, cities and towns that have adopted a local excise may vote to charge an additional community impact fee up to 3% on the following types of property: For traditional lodgings (bed and breakfast establishment, hotel, lodging house or motel) the date of booking is not important. If we are not on town sewer, do we pay a wastewater tax? Now the DOR is saying that we do not have to go into our account at all if we did not collect tax for a given month. Any lease signed on or after this date for a rental term beginning July 1, 2019, or later must include the rental tax. So any leases you sign from now on for occupancy in your home starting July 1, 2019, or beyond are subject to the new tax. Can we expect this site to do the same? Nantucket and the Vineyardare notcurrentlypart of the Cape Cod and Islands Water Protection Fund. A bed and breakfast home is not subject to tax. We also do not charge vacationers a service fee to use our site, and, because the booking transactions are not done through us, there is no fee charged for processing any payments. You can find more information about how to report and remit amounts collected in response to local rate changes in the regulation. Do not include sensitive information, such as Social Security or bank account numbers. Or do you think the tax applies only to security deposits that arent returned after the stay because of damage?
Do not use your ROC account number. Payment of the tax must be online, and the only way to submit it is to log in to the account that is created when you register. Alodging house or establishment is where lodgings are rented to four or more persons unrelated to the operator. Do Marthas Vineyard and Nantucket require collection of the Wastewater Tax? Top-requested sites to log in to services provided by the state. Registering as an intermediary or operators agent if you have multiple clients who are operators, Confirming operator registration as an intermediary, Aside from the limits on the length of a rental (90 days or less for traditional lodgings, 31 days or less for short-term rentals), there are a number of other exemptions to the excise. Jeff and I are proud to have two of our three grown children working for WeNeedaVacation.com, truly a family-run business. What if a town increases its local excise rate or imposes a new fee? We are now all considered businesses and as such need to purchase a up to 3% if an operator has more than one property in that locality or is renting an owner-occupied 2 or 3 family house on a short-term rental basis. If you would like to continue helping us improve Mass.gov, join our user panel to test new features for the site. Elizabeth. Warm regards, Rebecca Hansen, Thank you, Rebecca! All operators must register with DOR and obtain a Certificate of Registration for each property they offer for rent. Do I have to file a return even if I have no rental every month? We would be lost without your organization.
So, one of my guests, rents for 28 days in June, which I price relatively low ($200 less than my Summer Rate) It looks like she would be better off next year to rent for 32 days. If during the calendar year, you exceed 14 days of rentals, you will be responsible for paying the taxes that should have been collected for the first 14 days. However, if the property is rented for 14 days or less in a calendar year, you are not required to collect any tax. Would you like to provide additional feedback to help improve Mass.gov? falmouth rental vacation cod cape mile1 10min lounge yard walk town play So including rent, cleaning fee, etc., but not including a returnable security deposit. To register, go to this registration page. No, Kathleen, only rentals that BEGAN on July 1 or afterwards are subject to the tax.
The state will retain its 5.7% and remit the balance to your town. Local rates and fees must be added to the states room occupancy rate and reported together to the Department of Revenue on the same return. Lucky you! Perhaps it is there and I am just not A short-term rental includes an apartment, house, cottage, and condominium. So, you can choose to either tax it and return the tax along with the deposit or not tax it and take your chances that you wont need to withhold any of it. Many thanks for all you do! Even agents do not realize that insurance companies will refuse to pay claims if it involves a short term rental and the policy is a traditional homeowner policy. Could you send a sample lease to me? The state excise and any local option excise, including the Convention Center Financing fee, the new Cape Cod and Islands Water Protection Fund excise, and any community impact fee are to be paid with the return. If, however, you use an intermediary a realtor, property manager, or one of the large booking sites and they collect your funds for you, then THEY are responsible for collecting and remitting the tax for you. Select the Room Occupancy Consolidated Account. Intermediaries will register just once. A return is only required to be filed for a month that tax is due. An operators agent includes a property manager, property management company, or real estate agent. Currently this applies for all Barnstable County municipalities. Homeowners would be required to cover the cost of the inspection. For all types of rentals, as of July 1, 2019, the total amount of rent that is subject to tax includes all amounts collected by an operator or intermediary from an occupant, in exchange for occupancy. An operator can be an owner, lessee, sublessee, holder of a mortgage, licensee, or anyone else operating a short-term rental. The only month for which you need to file are those in which you had one or more taxable rentals. Was wondering if someone may have a sample lease showing all of the new line items for these charges included? Operators may want to include provisions in lease contracts stating that all state and local taxes and fees are as of the date of occupancy so occupants will be prepared for possible increases due to rate or fee changes after a contract is signed. You can find information about local rules, including whether a city or town is a member of the Cape Cod and Islands. Short term refers to any rental period of 31 days or less, so annual or long-term rentals are excluded from the tax. A bed and breakfast establishment is a private owner-occupied house where 4 or more rooms are rented, a breakfast is included in the rent and all accommodations are reserved in advance. An operators agent is anyone who manages a property for rent or books reservations of a property for rent. desimonej@dor.state.ma.us It is truly appreciated. Note that operators who already use MassTaxConnect do not need to re-register. Intermediaries must also make sure the operator they are working for is registered with the Department before collecting any rent from theoccupant. I have heard that for 14 days, I am exempt, Note that intermediaries who already use MassTaxConnect do not need to re-register. You will be asked to provide one of the following: A tax refund amount from one of your pastthreePersonalIncome Tax returns. Although only one owner can register, file returns and remit tax, each owner remains responsible for ensuring that the proper amount of tax is collected and remitted. When: as of April 1, 2021, the tax is due to the state viaMassTaxConnectby the 30th of the month after your guests departures.
While registration is not required under these circumstances, operators will then be in compliance in the event their short-term rental property is rented for a period of 31 days or less. What if a town increases its local excise rate or imposes a new fee? There seems to be some confusion about the 14 days. When and how do I remit the tax? A lock icon ( For all types of rental accommodations, if the total amount of rent is less than $15 per day, no tax is due. Anyone else able to share what you are doing for insurance liability coverage? On line 2, taxable rent, do not include exempt rent from pre-January 1, 2019contracts. The MA Department of Revenue offers a clear and helpful FAQs page with information about registering as an operator. (Note: that is what you are, an Operator.). The coverage is required to defend and indemnify the owner and any tenants in the home for bodily injury and property damage. It also does not include time-share property or bed and breakfast homes (see definition of bed and breakfast). Rents collected and reported by an intermediary are not considered exempt rents for the operator. Hi, Duane, Short term refers to any rental period of 31 days or less. The tax is the total of these taxes: Are there any exemptions to the law? All taxes and fees that are effective on July 1must be collected for occupancies on or after July 1, including the Cape and Island Water Protection Fund Excise. Nantucket mayopt into the Trust by majority vote of town meeting. Cities and towns are required to notify DOR of any rate or fee changes using the notification of acceptance forms for room occupancy and community impact fee. The exemption renewal process must be completed no later than January 15 of the calendar year claiming the exemption. Thanks so much,
seeing it. It is necessary for all of us to register online and pay by logging in to your account with the DOR online. Check with local officials in the city or town in which the property is located to find out more. Toll-free in Massachusetts (800) 392-6089 We have updated our FAQs with this item: Like operators, intermediaries are required to keep records related to amounts collected and provide those records to the Department upon request. Is this exempt from the tax? Your town may also require a separate registration and registration fee. A return is required to be filed only for any month when tax is due. If you do withhold any of it, you will be responsible for paying the tax on the amount you withhold. then you would register as an individual. Please provide information on how to register a short-term rental property with the state. See below. Cities and towns are required to notify DOR of any rate or fee changes using the notification of acceptance forms for, .