Airbnb collecting State Occupancy Taxes but not paying to the state

[Kimberly718]

Has anyone had issues with Airbnb collecting state occupancy taxes from guests and not actually paying them to the state? I received a notice from the state despite providing Airbnb with all of my tax information that the state had not received my occupancy taxes which Airbnb claims to have been collecting. Where has that money gone? Of course no way to speak with a knowledgeable rep at Airbnb only robots and instant message exchanges which lead nowhere. I am now being charged a penalty from the state for late payments. 

[Sunset-Bay-Cottage-LLC0]

Like maybe a lot of folks I am having real difficulty getting Airbnb to tell me how much in transient occupancy (TO) taxes they collect and pay to my County.  Our County charges 5% TO taxes. The County has been requiring that we as hosts pay it on a quarterly basis and I suspect that the County is being paid twice - once by us and another by Airbnb. The County is cooperative with my refund but needs to know exactly how much Airbnb paid on our account before giving us a refund.  I guess they have no way of telling how much to refund because it seems Airbnb collects and remits for a group of hosts in our County. It has been painful to say the least with Airbnb. So far they have refused to give me the data. I would much prefer that Airbnb stop remitting this tax because we as hosts are liable for it (not Airbnb) and if I pay it then I control when and how it is paid and can clearly account for it on my taxes.  But it seems that there is no opt out. What a mess!! 

[Joan2709]

@Sunset-Bay-Cottage-LLC0 

Yes...the whole tax issue is getting to be quite the mess. More and more jurisdictions are realizing that many Airbnb Hosts (or any STR Hosts on other platforms) don't pay local/city/county taxes as required. Their solution is to establish an agreement that Airbnb collect the taxes for every listing in their jurisdiction on each reservation and pay them instead of the Hosts paying them individually. This is usually done through Airbnb's City Portal program. The problem is, Airbnb pays the local jurisdiction in one lump sum...that is part of the agreement. There are no records you can get from Airbnb that state, "we paid $XX.00 in taxes for Jane Doe's Airbnb Listing." They can't. It's all in one lump sum. Your local tax authority should be aware of that. 

The only way to "prove" the taxes were paid is by showing them the earnings summary on the listing. Unfortunately, it will only show one heading for "Taxes", which includes ALL taxes including state occupancy taxes, sales tax, and local taxes. Many Hosts keep a spreadsheet for every reservation (and save a PDF version of every reservation by clicking print at the top of reservation details and saving it as a PDF). They then breakdown the taxes for every reservation on their spreadsheet so they know what taxes were paid and by who. 

Here are the problems:

1. Airbnb and/or the local jurisdiction don't notify the Hosts in the jurisdictions of the arrangement.

2. Some Hosts continue to pay the tax directly to the jurisdiction, unaware that Airbnb is collecting it for them. Sometimes jurisdictions still require Hosts to file the excise tax form and state "-0- owed as Airbnb collects and pays.

3. Some jurisdictions continue to ask for an accounting of the amount Airbnb paid in behalf of the Host, not understanding that is not possible, as Airbnb pays in behalf of all Hosts in one lump sum. They should know this.

The only way to "prove" the taxes were paid is by showing them the earnings summary on the listing. Unfortunately, it will only show one heading for "Occupancy Taxes, which includes ALL taxes including state occupancy taxes, sales tax, and local taxes. Many Hosts keep a spreadsheet for every reservation (and save a PDF version of every reservation by clicking print at the top of reservation details and saving it as a PDF). They then breakdown the taxes for every reservation on their spreadsheet so they know what taxes were paid and by who. 

I checked your listing and if you click price breakdown on a reservation, then click the underlined word taxes, you can see the jurisdictions they are collecting for on the reservation, but not the amounts. By doing the math, you can figure out if the taxes for all jurisdictions are being collected for correctly.

You can also turn on Pro Tools and go to the preferences icon.Then choose taxes, and you'll see there what jurisdictions Airbnb is collecting for. This is only visible on a desktop/laptop. Some Hosts get so frustrated they turn off the Default Collection and do ALL the tax collecting themselves. I don't advise that. Sometimes that is not even possible if there is an official agreement between Airbnb and the taxing authority for Airbnb to collect the tax and not the individual Host. 

The only way you can calculate the actual amount collected for the local county is by creating the spreadsheet and breaking down the taxes as shown on each reservation from either the Earnings Summary or by looking at each reservation and calculating the separate tax amounts. You can also take the lump sum amount on the Earnings Summary and do the math for each type of tax and get a pretty good idea of the total paid to the local jurisdiction. However, as mentioned, it is not reported to the tax authority under your name, but Airbnb pays ALL the taxes in one lump sum to the county. There is no way to identify how much was paid to them just for you alone.

I have seen this note somewhere in a Help Article that Airbnb can share your information with a taxing authority, but I think that is only if the local authority requests it from Airbnb and only if certain agreements are in place (which Hosts don't know about):

Information We Share With Tax Authorities

https://www.airbnb.com/help/article/2523#section-heading-11-1

What a mess...🙄

[Sunset-Bay-Cottage-LLC0]

Thank you so much for that explanation!  I have been trying to get information from AirBnB for days now, and still have had no luck.  I have shown them the description of the 3 taxes that they say they collect from guests and remit to tax authorities on our behalf (one transient occupancy tax and two sales taxes) , and have shown them the total of those 3 taxes that AirBnB says on the website that they collect and remit.  But like you said, AirBnB has so far refused to break that number down for me into the 3 separate taxes.  I need that because, as you note, we are one of those hosts that has been paying the County its 5% transient occupancy tax ourselves only to find out that AirBnB says that they have been doing the same thing.  When I called the County to get a refund, they told me that I needed to get AirBnB to give me a breakdown of how of the 5% TO tax that AirBnB paid for our rental before they would give me a refund.  AirBnB has so far refused to give me that number, or at least tell me how in the world they calculated the "Airbnb remitted tax" number on our earnings summary for 2024.  They won't even give me the math, and to make matters worse, the total number that they say they remitted for the year is FAR more than the relevant tax percentages (of 5% for the County and 5.3% for the State of Virginia).  If the percentages are applied to total gross earnings (from the downloadable CSV), then the resulting 10.3% would be FAR lower than the amount of "Airbnb remitted tax" from the earnings CSV summary.  So weird and confusing!  They must be collecting other taxes as well, or the percentage is applied to a number that is not the gross earnings number.  I keep pressing but no luck.  It's horrible.  At this point, I just need the annual number for the 5% transient occupancy tax (not the sales tax), but I can't see how I can get just that number for each booking, unless I misunderstood your note.  I tried to look at the earnings summary for each reservation but it still only lists the TOTAL number for all Taxes rather than just the County 5% transient occupancy tax.  Would be really grateful if you could let me know how to do that.  I am fumbling a bit.  Thank you so much!

[Amy3291]

@Kimberly718 Have you ever gotten Airbnb to show you who they are paying taxes to on your behalf? My local city government is saying that i have not paid my taxes, so I contacted airbnb and got the lump sum explanation, but can not provide a paper trail to prove my taxes are paid. This seems illegal to me, they have to show and prove that the taxes they withheld on my reservations are actually being paid out. It is a simple accounting paper trail.

[Elisa]

Hi @Amy3291 

Thank you for your replies. 😊

Don’t forget to mention the Host by typing @ followed by their name so they will know you’re replying to them.

Warm regards

[Kimberly718]

Hi @Amy3291, 

Here in CT we were told to file $0 when filing occupancy taxes. Airbnb collects it in a lump sum and I imagine, reports annually; they do not report specifically with your name/property so if you ask your state tax office if they received it they will say no. Tell them you are an Airbnb, and they will understand that the tax is paid directly. This was to avoid people not paying. It's not illegal as Airbnb is actually the one collecting income so they report for themselves and essentially for you. 

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[Claudine466]

I am dealing with the same issue with WV.  I paid all the taxes they said I owed including lien fees etc because they said I haven't paid anything. 

I spent an hour on phone with WV tax dept and the rep did not offer to just say I didn't owe but he was going to talk to his supervisor.  

I'm beyond frustrated and am probably owed a big refund but not sure how to go about that.  

Anyone who has solved this in WV, I appreciate your feedback and ad

vice!