Occupancy taxes being sent to the wrong account

[Alina817]

I have 2 properties on AirBNB, each with their own owners and accounts.  Airbnb says that they can only send the occupancy tax to the default account and NOT to the account associated with the property.  This causes me to have to make constant transfers on my end to keep the books clean.  I’ve kinda made peace with this EXCEPT now I’m afraid they’ll report incorrect numbers to the IRS.  They will be doubling occupancy tax for one owner and halving it for the other.  I can’t get AirBNB support to understand this at all.  It seems like they don’t understand anything actually.

i also need to submit separate paperwork per property based on the different owners.  They just tell me i need to talk to my local tax advisor on this.  I don’t need tax advice.  I just need to be able to submit one set of paperwork for property A and a different set for property B.  Again, AirBNB support does not seem to understand this.  All they said is “this is our protocol.”  Is it their protocol not to understand questions?  Sigh.

[Alina817]

i'm beginning to think i'm talking to a bot everytime i write to AIRBNB support.  They seem to take a keyword from my email then google that keyword.  then just copy/paste whatever they find.  i've "spoken" to multiple "people" and they never ever answer the question at hand.  sigh.  

[Lorna170]

@Alina817   You said that you have 2 properties on AirBnB, with separate owners and accounts.  I am assuming that you are acting as the host/property manager as the properties are listed under your profile.  If that is the case, when you first set up your profile and added the listings, whose bank and tax IDs did you provide?  

The way that I look at it is if you are the host/manager, then the listings should be in your name and using your bank and tax ID information as the reporting for income and taxes.  If that is what you intended, but not what happened when you listed, then you may have to remove a listing, open it under the (real) owner's profile with their bank and tax id information and then register as co-host.

[Alina817]

Hi Lorna170!  thanks for responding.  I appreciate it. 

I'm part owner of both properties.  Problem is that each property has a different ownership structure. 

What i think should happen is that i should be able to designate the appropriate ownership per property (or even per payment method).  I can't seem to find a way to do this.  And every time i ask AirBNB, they don't seem to understand and they just copy/paste some unrelated article.

At the same time, I'm worried about AirBNB's rule of NOT sending occupancy taxes through the routing rules and instead sending all taxes to the default account.  This leads to an over-reporting of taxes on one property and an under-reporting on the other.

[Abby338]

Did you ever resolve this issue? I am having the same problem and cannot seem to get anyone to understand

[Glenn252]

@Alina817 Was there any resolution to this? I am having the same issue.

[Alina817]

@Glenn252 No solution from AirBnb.  They were not helpful.  My accountant said that Airbnb is notoriously bad at their records.  We ended up entering the numbers manually and putting a note of explanation for the IRS.

[Pat271]

@Alina817  I have had 2 properties for 5 years, and this is just the way Airbnb does it. All pass-thru taxes are sent to the primary account.

It’s never been a problem, except, as you say, it’s less convenient to use the non-primary account to bookkeep all of your revenue, expenses and passthru taxes for the associated property. To solve that, I have a spreadsheet in which everything is broken out. I have guests in the rows, and categories, including all the different taxes, fees, number of nights, payouts, etc. in the columns, and I’ve created formulas for them. All I have to do for each guest is enter the guest name and nightly rate, and the spreadsheet does the rest.

You don’t have to worry about the IRS having the wrong figures, because Airbnb separates out the guest-paid accommodations taxes from the rest of the incoming revenue and gives them a different title/designation. 

There is also a PDF table you can generate and download from Airbnb that shows, among other things, the taxes broken out for each guest. I personally don’t reference that very often, but you may find it helpful.

[Alina817]

your situation is different than the situation I posted. 

i have 2 rentals each with a different ownership structure.  I am part-owner in both and manage both. 

I need to manually transfer occupancy taxes to the correct bank account since airbnb won't do that, which perplexes me since they are able to do it with regards to accommodations and cleaning fees.

occupancy taxes need to go to the correct property (and bank account) because each unit needs to pay taxes to the government separately under their own tax id.

this is why we need to correct the Airbnb's amounts that they include in their tax forms to us and write commentary to the IRS.

[Pat271]

@Alina817 

I don’t think my situation is substantially different than yours. We both have 2 properties that we wish to bookkeep separately. The fact that you are using a bank account to organize each property’s financials is just the particular method you are attempting to use. Airbnb will not report earnings to the IRS by bank account, they will report earnings by property, and that is only if your revenue and bookings meet certain thresholds (Form 1099-K). Likewise, the IRS will not analyze your revenue for each bank account and try to tie the revenue to a particular property. That is, if they do any kind of analysis at all.

My advice is to not rely on what Airbnb sends you as far as payouts per bank account being tied to the respective properties. Instead, bookkeep your revenue and all the breakdowns per property on a spreadsheet, and report on your tax forms and/or to your clients accordingly.

[Alina817]

The most important difference is the ownership structure.  One property is owned by one LLC and the other by a different LLC, both of which I am part owner. 

The fact that AirBNB will only send occupancy taxes to one account is where the problem is.  This causes me to do transfers from one account to the other to keep the books straight and this is also why AirBNB's books and mine do not match ... hence the reason my accountants need to include a note to the IRS explaining this.

[Alina817]

FYI ... This would all be solved if AirBNB would just sent the Occupancy taxes to the proper account like they do with the rest of the payment.