Houston Taxes

[Courtney38]

Hello everyone, 

I recently joined Airbnb for the super bowl that was held here in Houston. I had my first guest during that time and I have booked a second guest scheduled to arrive in March, but when I looked at my payout information I did not see where taxes were taken out. I know for sure that I need to pay taxes, as Houston has an occupancy tax. When I recently looked to rent a home in New Orleans I saw that there was a line that showed how much I would be paying in taxes, but when I looked back on my hosting/listing page I do not see a line for taxes for potential guest or where a line for any other fees other than a cleaning and weekend fee can be added. I called to speak to someone at Airbnb, but the lady was so confused herself and only made my question more complicated. 

So my question is....Are taxes taken out for renters in Houston? If not how can I charge my renters taxes, what apps are there or ways to add additional fees? I do not want to have to owe the city for unpaid taxes. 

[Cynthia-and-Chris1]

This article may help:  https://www.airbnb.com/help/article/654/what-is-occupancy-tax--do-i-need-to-collect-or-pay-it?topic=...

[Kijana0]

Found this on the Comptroller's Website:
https://comptroller.texas.gov/taxes/hotel/airbnb-faq.php

Do Hosts need to report Airbnb rental receipts or taxes collected to the Comptroller after May 1, 2017?
Hosts should not report any of their Airbnb rental receipts to the Comptroller on the Texas Hotel Occupancy Tax Report (form 12-100), either in Item 4 "Total Dollar Amount of Receipts" or Item 5 "Total Taxable Receipts" for any Airbnb bookings made on or after May 1, 2017. Airbnb will report rental receipts and remit state hotel occupancy taxes to the Comptroller for its Hosts' rentals.

What if Hosts use non-Airbnb websites for their short-term rentals?
The collection and remittance of Texas state hotel occupancy tax is required for all short-term rentals (unless an exemption applies). Although Airbnb is handling the tax for bookings on its site, Hosts are still required to collect and remit the tax for bookings made on non-Airbnb rentals.

Can Hosts who only offer short-term rentals through Airbnb close their hotel occupancy tax accounts with the Comptroller after May 1, 2017?
Yes. Hosts may close their state hotel occupancy tax account if, after May 1, 2017, they offer all of their short-term rentals through Airbnb. Hosts who do not close their accounts must file reports showing zero receipts or be subject to a $50 non-filer penalty. Hosts may still have reporting requirements for local hotel occupancy tax on Airbnb rentals within the city, county, or special purpose district that impose a hotel occupancy tax. If Hosts have further questions regarding local taxes, they should contact their local jurisdictions for more information.

Will Airbnb report to the Comptroller any personally identifiable information regarding the Hosts or Guests on its Texas Hotel Occupancy Tax Report?
No. Airbnb will not report any personally identifiable information regarding the Hosts or guests on its Texas Hotel Occupancy Tax Report to the Comptroller. Airbnb will only be reporting total receipts and total taxable receipts for each city and county.

[Kijana0]

 Airbnb does not take out taxes or charge the client or, even tell them that they have to pay the Hotel Occupancy Tax for Houston rentals. HomeAway/VRBO, offers a line item when they book that marks  the 17% that they will have to pay; charges them for it and sends it to you so you can then send it to the government. The tax system is convoluted so you have to send one text to the city one to the county and another to  the state once every quarter.

Reports and payments for State, County and City are ALL due quarterly and must be received by the last day of the month following the appropriate quarter:

• 1st Quarter (Jan. -Mar.) due by April 30th
• 2nd Quarter (Apr. -Jun.) due by July 31st
• 3rd Quarter (Jul. -Sep.) due by October 31st
• 4th Quarter (Oct. - Dec.) due by January 31st

BREAKDOWN

• 6% State of Texas, of which 0.5% tourism with balance to the general fund
• 7% City of Houston (collected by Houston First Corporation)
• 2% Harris County
• 2% Harris County Houston Sports Authority (collected by Harris County)

When I reply to clients seeking to book my units through Airbnb, I include a statement letting them know that there will be an additional 17% billed  that they have to pay upon arrival. I use PayPal billing to create and generate the bill.

[Jacqueline439]

Thanks so much for your answer.  it really helps.  So basically, you have a price for your rental, and once you get contacted you inform your guests that they need to pay 17% taxes that get paid separately so AirBandB doesn't get 3% of that amount.   I think is very clever because if you just add the percentaje they will take 3% of that amount. 

Thanks again, this clears it up nicely. 

[Letti0]

@Kijana0 Please do not charge your guests 17% as AirBnB pays the State of Texas the 6% they require on your behalf. You cannot charge it again that's double taxation your guests are paying a total of 23% tax on your units not 17%. You should only be charging them 11% on your AirBnB rentals and not submitting your Gross Earnings on the State of Texas forms on that money earned as it's already been paid by AirBnB on your behalf. You have been paying the State double the money. You can see what AirBnB paid by clicking on your Profile Picture and selecting Transaction History, then clicking on the green Gross Earnings on the right hand side of screen.  

Occupancy tax collection and remittance by Airbnb in Texas

State of Texas

Guests who book Airbnb listings that are located in the State of Texas, will pay the following tax as part of their reservation:

• Texas State Hotel Occupancy Tax: 6% of the listing price including any cleaning fee for reservations 29 nights and shorter in the State of Texas. For detailed information, visit the Texas Comptroller website.

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

[Colin429]

@Letti0 How do you collect the remaining % for your listings? I have a property in Atascocita and want to make sure I'm following the law and paying the correct taxes. 

[Mark234]

@Jacqueline439 - please note that Airbnb's decision to collect (or not collect) Occupancy Tax is based strictly on your location, and what agreements have been made with that country, county, or state. Also, Kitjana's answer incorrect for the state of Texas, as my reply below (as well as from Letti) states.

You should find out directly from Airbnb regarding Occupancy Tax for your location in Colombia. 🙂 

[Rajesh59]

airbnb is not collecting 7% city tax in cypress or jersey village, both still in harris county, and now city of jersey village is asking me to pay 7% occupancy tax for last 3 years.

[Kijana0]

No.  I stand corrected.  I just sent refunds of 6% to three of my short-term stays (most of my stays in the past were for over a month).   To Wit:

Found this on the Comptroller's Website:
https://comptroller.texas.gov/taxes/hotel/airbnb-faq.php

Do Hosts need to report Airbnb rental receipts or taxes collected to the Comptroller after May 1, 2017?
Hosts should not report any of their Airbnb rental receipts to the Comptroller on the Texas Hotel Occupancy Tax Report (form 12-100), either in Item 4 "Total Dollar Amount of Receipts" or Item 5 "Total Taxable Receipts" for any Airbnb bookings made on or after May 1, 2017. Airbnb will report rental receipts and remit state hotel occupancy taxes to the Comptroller for its Hosts' rentals.

What if Hosts use non-Airbnb websites for their short-term rentals?
The collection and remittance of Texas state hotel occupancy tax is required for all short-term rentals (unless an exemption applies). Although Airbnb is handling the tax for bookings on its site, Hosts are still required to collect and remit the tax for bookings made on non-Airbnb rentals.

Can Hosts who only offer short-term rentals through Airbnb close their hotel occupancy tax accounts with the Comptroller after May 1, 2017?
Yes. Hosts may close their state hotel occupancy tax account if, after May 1, 2017, they offer all of their short-term rentals through Airbnb. Hosts who do not close their accounts must file reports showing zero receipts or be subject to a $50 non-filer penalty. Hosts may still have reporting requirements for local hotel occupancy tax on Airbnb rentals within the city, county, or special purpose district that impose a hotel occupancy tax. If Hosts have further questions regarding local taxes, they should contact their local jurisdictions for more information.

Will Airbnb report to the Comptroller any personally identifiable information regarding the Hosts or Guests on its Texas Hotel Occupancy Tax Report?
No. Airbnb will not report any personally identifiable information regarding the Hosts or guests on its Texas Hotel Occupancy Tax Report to the Comptroller. Airbnb will only be reporting total receipts and total taxable receipts for each city and county.

[Mark234]

@Kijana0 @Courtney38

Letti is absolutely right; Kijana's answer is incorrect and Airbnb does in fact collect Occupancy Tax for all Texas hosts, and pays it on the hosts' behalf.  In fact Airbnb was very diligent in communicating this fact to Texas hosts when they first began doing so (well before you replied to this post in August 2018), and it is very clear in the invoice to each and every guest in Texas that there is an Occupancy Tax that is charged automatically.  You do not directly pay Occupancy Tax to Houston OR the state.

Courtney, please reach out if you still have questions in this matter...and always double-check answers as some may not do their research first.  This IS the internet after all - nothing is regulated!

[Kijana0]

More research done. Evidently AirBnb collects the 6% portion owed only to the STATE OF TEXAS.  We still have to collect and report our city and county taxes.

BREAKDOWN
    * 6% State of Texas, of which 0.5% tourism with balance to the general fund
    * 7% City of Houston (collected by Houston First Corporation)
    * 2% Harris County
    * 2% Harris County Houston Sports Authority (collected by Harris County)

This means that I owe him a 6% refund.  I will still have to send the 11% balance in to the City of Houston and Harris County.  Plus report the AirBnB portion, perhaps, somehow, paid on my behalf to the State by AirBnB  by the 20th.  (evidently noting that it has been reported as being credited to my host address--hopefully) and that I owe nothing for that portion.  If I don't do that, the state will fine $50 for not reporting.  That already happened to me earlier this year when I assumed AirBnB had done the state, so I didn't send in a report.  Tricky.

-Kijana

[Letti0]

@Kijana0  Do you book on other sites like HA/VRBO etc? If not and AirBnB is the only place you book from, call the State Controller at 888-334-4112 and tell them you only do AirBnB and they will remove you from having to file a return each month. I book on other site, so I still need to pay the State for those earnings.

[Kijana0]

I book on both AirBnB and HomeAway.  Since talking with the other hosts here, I realize that I was erroneously charging my guests the state tax that, evidenly AirBnB had already taken out.  So, I just sent a 6% refund to the three bookings this past summer who I had charged for the State portion of the HOT tax.  

I will call the State Comptroller tomorrow to find out exactly how I report that credit for those bookings on the form they send from Austin.  I only report every 3 months, but see no line item or provision on that form that allows me to deduct the AirBnB payment from what the State calculates I owe.  Suggestion?

[Kijana0]

Found this on the Comptroller's Website:
https://comptroller.texas.gov/taxes/hotel/airbnb-faq.php

Do Hosts need to report Airbnb rental receipts or taxes collected to the Comptroller after May 1, 2017?....
Hosts should not report any of their Airbnb rental receipts to the Comptroller on the Texas Hotel Occupancy Tax Report (form 12-100), either in Item 4 "Total Dollar Amount of Receipts" or Item 5 "Total Taxable Receipts" for any Airbnb bookings made on or after May 1, 2017. Airbnb will report rental receipts and remit state hotel occupancy taxes to the Comptroller for its Hosts' rentals.

What if Hosts use non-Airbnb websites for their short-term rentals?...
The collection and remittance of Texas state hotel occupancy tax is required for all short-term rentals (unless an exemption applies). Although Airbnb is handling the tax for bookings on its site, Hosts are still required to collect and remit the tax for bookings made on non-Airbnb rentals.

Can Hosts who only offer short-term rentals through Airbnb close their hotel occupancy tax accounts with the Comptroller after May 1, 2017?....
Yes. Hosts may close their state hotel occupancy tax account if, after May 1, 2017, they offer all of their short-term rentals through Airbnb. Hosts who do not close their accounts must file reports showing zero receipts or be subject to a $50 non-filer penalty. Hosts may still have reporting requirements for local hotel occupancy tax on Airbnb rentals within the city, county, or special purpose district that impose a hotel occupancy tax. If Hosts have further questions regarding local taxes, they should contact their local jurisdictions for more information.

Will Airbnb report to the Comptroller any personally identifiable information regarding the Hosts or Guests on its Texas Hotel Occupancy Tax Report?....
No. Airbnb will not report any personally identifiable information regarding the Hosts or guests on its Texas Hotel Occupancy Tax Report to the Comptroller. Airbnb will only be reporting total receipts and total taxable receipts for each city and county.