Is Airbnb remitting the Hotel Occupancy Tax for my Airbnb?

[Denise253]

I'm a Superhost in Dallas and have assumed that Airbnb is collecting and remitting the HOT on my cottage. We have recently received notification from the city that all STR hosts will have to report their monthly earnings and pay a HOT directly to the city. This is redundant, and I don't know how to confirm that Airbnb is actually providing the tax service that they tell us they are handling. Any thoughts or help from any other Dallas, TX hosts?????

[Kelly149]

@Denise253 ABB pays Texas HOT, you are responsible for everything else. There is a setting for adding this to your rates

[Denise253]

So now I've got to pay a state and city HOT? Kelly is there a city/county Hot in Austin as well as the TX HOT? If so, what is the % and do you remit it through munirev.com? This is new in Dallas as of December. Just trying to figure out the details. Neither Airbnb is aware of it, nor is munirev aware of Airbnb's HOT collection and remittance. Guess next stop is the Dallas CFO who signed the letter of notice to STR hosts. New and confusing. But I will get to the bottom of this. Probably won't like what I find out.

[Lisa723]

@Denise253 if you want @Kelly149 to be notified that you replied to her, you have to tag her with "@".

[Lisa723]

@Denise253 I'm not in Texas, but just to second @Kelly149 -- Airbnb is not a reliable source of information about whether they are paying your local taxes. In my area as well, they pay the state lodging tax but are totally oblivious to the fact of the county tax. So they say/think they are paying all my taxes, but they are not. Your local taxing authority is the best source of information on this.

[Kelly149]

@Denise253 I'm sure as a realtor you know that every government gets it's cut, you've been renting since at least 2017, have you paid no taxes in that time? Every city is different, you should certainly follow the CCRs and the ordinances for your location. In Austin there is City, County, Tourism Development & State taxes, Austin hosts are also supposed to get a license from the city and be legal with their HOA. (I'm outside city limits so I thankfully do not have to mess with any of that.) If you were here, the city would be asking you to go backwards and pay them all the taxes you've skipped since 2017 and probably fines on top to boot. If Dallas is trying to get a lid on STR you may want to go back and find out what your rules are (were) and get compliant or close shop and hope they go for bigger fish. Or you can follow up with whoever sent you a letter and beg for forgiveness and leniency if you get proper procedures set in place going forward. Good luck!

PS you've surely reported all your income to the IRS too, right?

[Denise253]

@Kelly149 

Yes as a realtor I do understand that Gov get's it cut and I also understand that full disclosure is the only way to do business. I even registered my property with the city when I first started, they sent someone out to inspect the property and then told me there is no city required registration for a STR. Better to disclose. This is a new city registration process for STRs and HOT collection. I now know there's many levels of taxes and levys.

I've looked around on the site to add a tax on my listing. Under local taxes there's no "add a tax". Do you know where the setting is for this? Thanks

And yes my income taxes are just fine. Fully disclosed. LOL

[Lisa723]

@Denise253 

https://www.airbnb.com/help/article/2523/how-do-i-add-taxes-to-my-listings

[Teresa656]

@Kelly149 

I tried the path of forgiveness and leniency... NOPE!!!   Although the guys were nice they said it cant be done.. Gotta pay to play. I had to go back and Pay all fees and fines as well as taxes

[Brian151]

@Teresa656 @Rodderick0  Teresa,

Can you tell us what Dallas knows?  How did they even know how much you got in cleaning fees? 

Rodderick, did AirBnB give you monetary assistance for your Dallas Tax?

[Teresa656]

@Brian151 

The original guy I spoke to at the city Controllers office told me that they were searching through the Airbnb site and seeing who was leasing in Dallas. I suppose they could get the information from Airbnb about how much I actually make in nightly rates and cleaning fees .. 

[Teresa656]

@Denise253 

I am in Dallas and also just found out about the City Tax of 7%. Apparently it has been on the books since 1969 so it is completely my fault for assuming that the taxes Airbnb take are all I needed to pay. Airbnb collect the state tax but Dallas does not have an agreement with Airbnb to collect city taxes. I was fortunate to talk to someone at the City who explained it all throughly to me and I have had a couple of talks with Airbnb help desk and they have been helpful too. The real problem is that I have to go back and pay ALL the taxes I DID NOT collect AND the fees AND the fines!!! ( This includes the money collected on cleaning fees also!!) The help desk at Airbnb told me that I needed to inform potential guests in my description that I will be collecting the extra 7% AFTER they book through the resolution center. I have started doing that for future booking but it is a pain in the arse !!  I am looking at trying to figure it out by collecting it as a resort fee, adding in a little extra to cover the cleaning fee tax... Would love to know if anyone comes up with a better alternative

[Brian151]

Needless to say, if you had just kept it as a regular rental, you wouldn't be paying all these extra taxes and late fees.

We lose, city wins.   Obviously, AirBnB wasn't a good decision for me for my property.  In fact 😮, let's just call it a bad decision

[Linda108]

Hi @Denise253   In the Help Center I found this article about what Air BNB collects in Texas.

https://www.airbnb.com/help/article/2331/occupancy-tax-collection-and-remittance-by-airbnb-in-texas

Tax collection and remittance must be an agreement between the taxing agency and Air BNB.  In my city years ago, Air BNB started to collect and remit taxes, but there were several flaws in the Air BNB system, namely no individual trail for the taxes collected sent to the city.  My city determined this lump sum payment was too risky in terms of able to audit and terminated the agreement.

Also, not everyone can use the tool to add the tax to the reservation as it depends how you are set up in the system.  

https://www.airbnb.com/help/article/2523/how-do-i-add-taxes-to-my-listings

[Teresa656]

@Denise253 

I ,too, am a Dallas host and recently found out about the City 7% tax. I was fortunate to get someone at the City to explain it all to me . Airbnb collects the State taxes but they do not have an agreement with Airbnb to collect City taxes. The Hotel tax has apparently been a law since 1963 (i believe he told me) so my bad for assuming.. I went up as high as I could on the food chain and while there was sympathy, there was no leniency so I had to go back and pay ALL TAXES (even though I did not collect them..so out of pocket) All fees and ALL fines..We also have to include the cleaning fees in the amount taxed!!! They said they will do a payment play but I have to pay ALL of it..I also spoke to a couple of people from Airbnb who suggested that I put the information of collecting the city taxes in my listing description informing the guest that after they book they will get a notice from the resolution center to collect the tax. I have to  go in after every booking, add up what tax will be collected (including cleaning fees) and send a request through the resolution center..I am trying the resort tax fee but it looks like I have to pay taxes on that too if I collect it that way!!!   It is a pain in the arse !! Please let me know if you get any great insights