South Carolina taxes - all covered, or just state?

[David259]

On May 18, I received an email saying that Airbnb will begin collecting and remitting taxes in South Carolina starting June 1, 2016. I was very excited! I currently pay a fee to MyLodgeTax (Avalara) to handle tax reporting/payment to all the various state and local entities, and would love for Airbnb to handle that (for free). HOWEVER, when I emailed MyLodgeTax to cancel their service, they told me that "Airbnb is actually only paying the taxes collected by the state of South Carolina, but there's a separate accommodations tax collected by/paid to Charleston County."

Is it true that Airbnb isn't handling ALL taxes? That would be really, really frustrating!!

As part of my contract with MyLodgeTax, they handle the following taxes, which add up to 13.5% total:

South Carolina Sales Tax  5.0%

South Carolina Accommodations Tax  2.0%

Charleston County Accommodations Tax  2.0%

Charleston County Local Option Tax  1.0%

Charleston County Education Tax  1.0%

Charleston County Transportation Tax  0.5%

North Charleston Accommodations Tax 2.0%

I would STRONGLY prefer for Airbnb to handle all these taxes; a "halfway" approach (only doing state-level taxes but not local) will just complicate things, and force me to keep using MyLodgeTax, or else do a lot more manual tax paperwork. Ugh. It would also mean that realistically, a lot of folks simply won't pay the local taxes that they owe. Double ugh. Please help out us SC hosts who want to do the right thing, Airbnb!

[Ed-and-Hugh0]

Contact Avalara. They are really good about knowing exactly what taxes Airbnb is collecting and which are not. I use them, and they advised me to create a separate listing on their site to report income after the change-over.

[David259]

Thanks for the response. I was hoping to get confirmation from Airbnb directly to know what taxes they would be handling. I've been on the phone for close to an hour now (on hold) trying to get through to Airbnb support, been hung up on multiple times by the automated phone system, and still no answer... very frustrating. 😕 So much for receiving "priority support" as a Superhost...

[Laurie6]

Contact Denise at  *sensitive information hidden*

[David259]

I finally got through to Airbnb support and received the following email response; wanted to share it here in case it's helpful for others. I did send Eddie a follow-up email to make sure I'm understanding my specific situation correctly. (Laurie, I just noticed you replied a couple days ago! Thanks for the reply, sorry I didn't see it sooner.)

Eddie, Jun 3, 11:55 PDT:

Hi David,

Eddie again here with the Premium Support team.

Thanks for reaching out about local taxes in your area. Here are the details on the amounts being accounted for in South Carolina:

Guests who book Airbnb listings that are located in the State of South Carolina will pay the following taxes administered by the State as part of their reservation:

South Carolina State Sales and Use Tax: 5% of the listing price including any cleaning fee and guest fee for reservations 89 nights and shorter.

South Carolina State Accommodations Tax: 2% of the listing price including any cleaning fee and guest fee for reservations 89 nights and shorter.

Local Taxes collected by the State: 0.5-8%, per Local Tax type, of the listing price including any cleaning fee and guest fee for reservations 89 nights and shorter. One or more of the following Local Taxes may apply: Capital Project Tax, Catawba Tribal Tax, School District Tax, Education Capital Improvement Tax, Transportation Tax, Local Option Tax, Tourism Development Tax.

Note that Airbnb is only collecting the Local Taxes that are administered or collected by the State at this time. For detailed information, visit the South Carolina Department of Revenue website and the Sales and Use Tax Manual here: https://dor.sc.gov/resources-site/publications/Publications/Accommodations%20and%20Admissions%20Tax%...

Guests booking listings in locations where Airbnb has reached an agreement to collect and remit local occupancy taxes are assessed tax at the time a reservation is accepted. The amount of the tax is shown as a line item on the listing’s public page and again to guests before booking.

Hosts may view the amount of occupancy tax paid by guests in the Gross Earnings section of their Transaction History, and can confirm which jurisdictions are being accounted for from Manage Listing > Location, underneath the Address section.

For your reference, here is a link to our Help Center article on this subject:https://www.airbnb.com/help/article/653

I hope this is helpful. If you have additional questions regarding policies in your area, we do recommend reaching out to a local tax professional or the local tax authority.

Best regards,

Eddie
www.airbnb.com/help

[David259]

Here's the second email I got, answering my clarifying questions:

Eddie, Jun 3, 12:52 PDT:

Hi David,

Thank you for your response. To clarify:

1) Correct: occupancy taxes will only be collected/remitted for reservations booked on or after June 1st, 2016. Accordingly, you'll need to coordinate taxes separately for reservations booked before 6/1.

2) Correct: Airbnb is only collecting the Local Taxes that are administered or collected by the State at this time. Accordingly, since the Charleston County taxes you mentioned are not being collected by the State, you'll need to coordinates those taxes separately as well.

I appreciate your request. However, the process is quite involved in order for Airbnb to be granted legal authority to collect and remit taxes on hosts' behalf. If it were up to Airbnb solely, we'd gladly facilitate this process for all occupancy taxes (local, state) as we understand how much more seamless the process is for guests and hosts alike. The collection of state taxes is a step in the right direction.

We hear you loud and clear and truly appreciate your preference. Please know that we have a dedicated team working with officials in order to make this happen. There is not a definitive timeline, but our dedicated hosts in South Carolina will be the first to know as soon as further collection/remittance are approved and implemented.

Best regards,

Eddie
www.airbnb.com/help

[Rebecca49]

Thank you for sharing what you learned.

Fortunately, the local taxes in HHI are paid quarterly, so not too difficult to compute.

Rebecca

[Martia38]

Thanks David. Yes. I've called CHS Co and they (obvisouly) are not receiving tax from ABB. Called DOR: they do receive 10%: 

7% for SC

3% for their County

This totals 10%

My question: what is ABB doing w/ the other 3.5%? 

Can you help me with this? 

ABB can't seem to return my call or answer it. 

Warmly, Martia, Folly Beach

[David259]

Hi Martia, I'm afraid I can't help you with your question; I stopped actively hosting with Airbnb a few years back when we started having kids, so I'm not in the loop with taxes.

However, before we stopped, we used Avalara (MyLodgeTax) to handle our tax payments and make sure we were in compliance, and for a fee, they made it seamless.

One option if you don't want to pay a fee long-term would be to hire them for a few months then request a copy of everything they've filed on your behalf to get a template of what needs to be filed.

[Jeremiah-and-Emily0]

Thanks David and others for weighing in on this.  I am assuming that Airbnb will be collecting and remitting the state tax (2% accommodations fee + 5% state tax), but we will still need to "file" on the MyDORWAY website (SC Dept. Of Revenue).  If anyone has more information on this please let us know.  Thanks!

[Debra20]

I'm also concerned about how to handle Charleston local taxes.   Also I understand that bnb send a 1099K at end of year to those that make over 20K.  I'm definitely not in that category, so do I just keep track of my earnings and files it as additional earnings and pay taxes on that amount?

[Claudia52]

Debra, 1099K is for filing with the IRS which is a separate issue for your tax consultant. 

I had to get a business license for my bnb in Greenville, SC and pay SC sales tax and accommodation tax to SC AND local tax to Greenville County.  I didn't need a business license for my spare room on Airbnb when I set it up BEFORE Airbnb took over paying the SC Sales and accommodations taxes and I didn't have to pay taxes on it because it was in the home where I live and it was only 1 room.  BUT now Airbnb charges those guests and pays that for me even though I didn't have to.  HOWEVER, I am still paying HHI accommodations tax and beach tax quarterly. 

At IRS tax time, I have to file two business forms, Schedule C's, one for the bnb in Greenville and one for the bnb in HHI. 

Hope this helps to make things as clear as pluff mud, but your tax accountant should be able to help you.

My question was how can I tell what Airbnb is paying on my behalf and that is answered in the Transaction History > Gross Earnings which I intend to download to Excel, print and keep with all the paperwork for my State Taxes. 

I was told by the state that I can not close the business and still operate the bnb which means that I will still have to continue to file a $0 return every month at MyDorway.  Periodically, I may send them a paper return with my the excel spreadsheet that I downloaded to show them that Airbnb is paying my taxes for me.  Probably quarterly when I'm working on my quarterly HHI tax payment. 

[Karen430]

he My transaction history report says nothing about the taxes they paid on my behalf. Are you saying yours does? I rent out in Myrtle Beach in  Horry County, SC.

[Lillie13]

I also rent in Horry County and the taxes are not being paid.  I'm told that I need to apply for a business license and pay quarterly.  My question is that I don't know how to collect this separately on Airbnb.  How are you handling it?  

[Stacey51]

Hi,

Did yall ever get anymore information on this? I am new to short term rentals in Beaufort and am a little confused whether airbnb is collecting just for the state or also remitting to the City of Beaufort. Any help would be appreciated. Thanks