Denver taxes

[Emily66]

Does anyone know what you need to do as a host to make sure you're charging all taxes as well as paying all taxes needed? 

don't want to end up owing the IRS all my money come April 2017.

Thank you!

[Marianne81]

I just got off the phone with Denver Tax...they said that it does not need to be a separate line...that this is Airbnb making us do that...becasue if it is part of our rate then airbnb will be charging their fee on that. Airbnb needs to create a listing line where we could put it in. We should all speak up and request airbnb to do that.   As far as Denver cares...they just want to collect the money...and if we get autidted we need to account for how much we collected.  

I am going to add to my description that this amount includes 10.75% Denver Lodging Tax. Yes, airbnb will be collecting on that amount and I dont' know what that exactly is but to me this is way easier than doing the add on after a guest has already paid. 

[Pamela61]

Yes, airbnb will be collecting a service fee on the 10.75%, but more importantly, you will be taxed 10.75% of that 10.75% because you have it in the gross amount! You must do a calculation that will remove 10.75% of what you took in quarterly BEFORE calculating the 10.75% you owe.  Confusing? You bet it is! Here's the formula:

If Y equals your total income, including the Denver tax you collected,

and X equals your total income, NOT including the Denver tax you collected

Y divided by 1.1075 = X (your total short term rental income)

X times 0.1075 = the total amount you should pay in taxes

So say you collected $1000 in a quarter. First calculate the amount you should actually be paying taxes on:

1000 divided by 1.1075 = $902.93.  That is the total amount you should be paying the Lodger's tax on!! Next step:

902.93 times 0.1075 = $97.06.  The tax form will calculate this for you, but it's nice to be able to double check.

Looks like I might be wrong about the cleaning fee deduction, which seems strange to me. I'd love to see if hotels collect a lodger's tax on their service fees, or just on the base price of the room. Hmm. Might go and ask how they do it.

[Leanna7]

Im a new host and just read the tax stuff on https://www.denvergov.org/content/dam/denvergov/Portals/571/documents/BusinessTax/Short%20Term%20Ren... and it states that as of APRIL 1, 2018, AirBnB will start colelcting the lodgers tax.  I jsut book my first 4 stays (first arrives next weekend), so wondering, how do I know if I need to collect anything additional from visitors?

Thanks 

[Kyndi0]

I’m wondering the same thing.  I had booking that booked in March, but no stays until April.  So all the bookings bf that booked prior to April 1st, I have to go back to the guest and ask them to pay the additional 10.75% lodgers tax?  Does anyone know?