Airbnb charging incorrect amount for Massachusetts tax

Airbnb charging incorrect amount for Massachusetts tax

I have an apartment on Cape Cod—mainly rented through Airbnb—that's subject to the new Mass. occupancy tax on vacation rentals. It's actually a package of state/county/local taxes that adds up to 14.45%. Tax applies to rentals booked after 1/1/19 and commencing after 7/1/19. So far I have 6 bookings that fit into this category.

 

I've already spent a vast amount of time trying to figure this out: first Airbnb told me they would not be collecting the tax this year, so I set things up to collect tax from guests manually. Then a few weeks ago, I find out that Airbnb IS collecting tax on some of the bookings -- but it's not the correct amount! What they're collecting works out to 8.7% of my net payout, which bears no relation to any of the individual taxes that make up the package. I dread trying to explain this when I report and remit taxes to the state, which I will have to start doing this month.

 

Anyone else run into this?? 

11 Replies 11
Bob384
Level 1
Chatham, MA

I'm curious if you have had any resolution to this?  In Chatham the taxes are 12.45% and AirBNB seems to be getting it right, although at least one reservation shows that the guest paid more.  It has been a terrible pain to collect taxes from guests who don't understand the situation.  It seems like AirBNB started in mid-June collecting taxes for reservations on or after July 1. Do you know anything about how airBNB remits the taxes on our behalf? That is our biggest concern because we can't tell if they have actually done what they claimed they would do.  We just paid taxes even for reservations that airBNB said they would cover because it is not clear how all of this is supposed to work and we didn't see any payments from them in our account.

Jim379
Level 2
Portland, OR

I would also like to know information about how they charge occupancy taxes and how we can evaluate if they are charging correctly... is there a way to see just what they are charging the guests other than asking the guest to show their reservations information and charges? I think AirBnB is charging our guest for a county tax that we are not located in. 

Sean-And-Jenn2
Level 2
Burlington, MA

I’m not sure if anyone has solved this riddle but here is what I have learned. I can see the occupancy tax charged to guests on my gross earnings summary (download the csv). I’m in south Yarmouth so it should be 14.45%. It’s correct for all but one guest, the most recent, who was charged 16%+. After countless calls and emails with support I got no where. I couldn’t even get an answer on if the deductions included state/local and the water excise tax. They would not even tell me if Airbnb was charging a service fee for remitting for us. They told me to call a tax specialist. I asked if they expected the tax specialist to know what Airbnb was doing! I gave up eventually but want to go back to see if the guests who was charged more than 14.45% paid in foreign currency to see if maybe that was a contributing factor.  I just don’t know. We seem to be on our own to figure this out. 

I downloaded the CSV, but there is no information there about taxes at all. This is extremely frustrating, as Airbnb has no answers.

Download gross earning, third tab, it has occupancy taxes, linen fees ,community taxes if you added them for collection, host fees and the amount remitted

Ruth102
Level 2
Malden, MA

I have spent an endless amount of time working with Airbnb support to get my listings to be recognized as exempt from the new Massachusetts state regulation occupancy tax charged to guests before the December 1 deadline. After assuring me that they would find a way to do this, in the end they told me they don't support exempt listings and changed my two listings to 91 day minimum stays in order to be considered "long term rentals" which are exempt from the regulation.

 

The first thing that is wrong with that is that the Massachusetts regulation considers anything over 31 nights to be long term (and therefore exempt from the occupancy tax).

 

Airbnb seems to be applying Boston's City regulation's definition of short term rental, which is 90 days. My listings are not in Boston. (I found an article in the Boston Globe about Airbnb and the new, very stringent Boston regulation. I have read the Massachusetts state regulation on the state's website).

 

Secondly, my listings are in an owner-occupied property, which the Massachusetts regulation exempts (up to three rooms) in an owner occupied unit. Airbnb has already been illegally collecting the occupancy tax from my guests who stayed before this December 1 deadline.

 

Now that Airbnb has changed my two listings to be minimum of 91 nights I will not be getting them booked.

 

If I register them with the state then Airbnb will collect the occupancy tax from the guests that they don't actually legally owe.

 

I am wondering if the state attorney general's office would be interested in stepping in to force Airbnb to correct this situation of making it possible to list rooms that are exempt from the occupancy tax.

 

 


@Ruth102 wrote:

Secondly, my listings are in an owner-occupied property, which the Massachusetts regulation exempts (up to three rooms) in an owner occupied unit.

 


Your listing is exempt ONLY if you provide breakfast in an owner-occupied property, up to three rooms. You might wish to add that if you don't want the tax to be charged to your guests.

 

Many of us have changed our listings to Private Room in a Bed and Breakfast which tricks the AirBNB software into removing the tax.

Shawn242
Level 1
Milton, MA

I am having the same conversation with Airb&b.   No one I talk to seems to get what I'm talking about.

 

When I download the spreadsheet from their website on the "Transaction History->Gross Earnings" tab, the numbers reported for "Gross Earning" column and in the "Occupancy Taxes" column do not work out to the required taxes.

 

I've got a very simple location - no complicated local taxes, I don't have long-term rental issues etc.just the straight 5.7%.

 

When I do the calculations to calculate how much Arib&b collected and remitted (on my behalf), I have many / most of the reservations are straight on 5.7%.   But some are off by quite a bit.  Some have 0% collected, some have 6.44% collected, some have 8.19% collected.

 

I wouldn't care if they occasionally collected a little too much , but more often than not they are under collecting and in aggregate they are under collecting.

 

I to have spent hours on the phone with them and open many tickets.   Every time I get a new person on the phone they push they same script on me and get get back to the same place - they're going to forward the ticket someone show know more.   Then I get an email with some stock response that doesn't answer my questions.

 

Does AirB&B monitor this forum?   Anyone out there????

 

There's a bunch of us here who need help and don't seem to be getting it!!!

Hi Shawn - did you end up getting clarity on this? Are you also getting taxed for stays > 30 nights? The tax law is clear that stays < 30 nights are to be taxed, yet Airbnb is charging taxes for reservations > 30 nights. This is impactful to guests and hosts since they are overpaying by up to 17.95%. I raised this to customer support and they couldn't help me and pointed me to raise this to Airbnb in the feedback form. Not helpful so far. 

 

Jeff574
Level 2
Breckenridge, CO

My property is being taxed as if it is within town limits. It is in the unincorporated portion of our county. The difference is significant.

I discovered this in December 2019.

I have been in touch with 5 different customer "service" people and still no resolution.
Airbnb has asked for:
GPS coordinates of the property
A tax statement showing the jursidiction

A statement from the local assessor's office showing the jurisdiction.


I've supplied these items more than once...still no resolution.

 

 

Johanna270
Level 2
Arlington, MA

Ok So they remit on our behalf, so 

Do I count the occupancy taxes and the community fee as taxes I paid on my state return?

Where do I find the evidence that AirBNB remitted the money to the MA or the community fee to my town Arlington?

Only in my first month did my number on my 1099-k match the gross earnings from the spreadsheet , how are these numbers calculated?