Arizona Occupancy Tax

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Karl28
Level 2
Page, AZ

Arizona Occupancy Tax

I have confirmed the occupancy tax is being collected by airbnb for bookings in Arizona occurring after 01/01/2017...The terms of service state that hosts can view the amounts collected in the transaction details...no such information is available.  The agent I spoke with at ADOR has no information regarding airbnb remitting taxes on my behalf.

 

I have now made 3 calls to airbnb support asking how this process works...they pass my queries on to the tax department and they respond via email to consult the help center which doesn't seem to have an answer.  I need confirmation that tax dollars charged guests is being remitted somehow and credited to my tax liabilities which I am responsible for reporting and paying monthly.

 

I would think ADOR needs airbnb to identify my TPT license number (which they don't have) to insure remittance gets to the correct account and can be funnelled to the different agencies where tax is due. Surely someone can tell me where the tax revenue collected goes and how it is applied to my tax liabilities.

1 Best Answer
Chris225
Level 5
Flagstaff, AZ

Hi Karl,

Thanks for raising this question, it's a great change in 2017 that many AZ hosts need to understand. I've been doing AirBnB hosting since October 2015 and I am also curious how to now do the TPT-EZ or TPT-2 form due to the change this year. I understand AirBnB is collecting occupancy tax for the state, however, I'm unsure how to document this on the TPT-EZ form--or if it's even required.

Also, it looks like AirBnB is collecting both State, County, and City.

 

For instance here an example of how it could be laid out:

DateGrossAirBnB FeeHost EarnedAirBnB Occupancy Tax CollectedTaxes Due (State & City)Taxable Earned IncomeCity TaxesState Taxes

2017-01-01

$158.00

$5.00

$153.00

$17.00

$15.59

$142.41

$5.77

$9.83

 

From this example, a host would owe $15.59 to the state for this night. AirBnB collected and paid the state $17. In this example it doesn't seem that the host would owe anything to the state or city. But how are they to let the state--and city for that matter--know that they are all paid up.

 

I understand our city is also quite concerned about getting paid from the state, and we had to recently add our city as a region in AZTaxes. What I don't understand is how I know as a host and holder of a state business license, that the state and city and I are on good terms--that AZDOR is getting the taxes required from me via AirBnB, and AZDOR is designating funds to the county and city on my behalf.

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41 Replies 41
Sabine42
Level 10
Tucson, AZ

Hi Karl,

Go to the Transactions tab and then go to Gross Earnings, the Taxes are listed there.

Thank you...guess I missed that....how and when to those tax funds get remitted to Arizona Department of Revenue?

There's nothing to do on your end, Airbnb remits them.

 

https://www.airbnb.com/help/article/1036/how-does-occupancy-tax-collection-and-remittance-by-airbnb-...

 

hope this helps!

I guess I'll just have to wait and see but I can't understand how I will be credited for these tax remissions if airbnb doesn't have my identifying TPT info....and.... I am responsible for MONTHLY payments...when are they remitted by airbnb?

@Karl28 , I'm also here in AZ - and yes, there is confusion about this.... So I got the official AZ TPT registration done: first they didn't want to issue it to me, saying I don't  need it for residential rental (as I am present at the house). But city authorities here in Prescott only give you their license after you got the TPT license from the state. So I went back to them, saying that transient rentals for less than 29 days do require  a license, so they gave it to me. Discussing that Airbnb will remit the payments on my behalf (yes, not having our TPT number, Airbnb must go/remit the collected taxes only by name, or with our SS number which we submitted in our W9 form to them, so then AZ authorities can match it properly to our account, I imagine) I was told to file the report (i signed up for annual reporting)  without any payment, but an exemption code, which in my case is 11-23.

They at AZ TpT didn't know the code, I got that from the Prescott tax authorities. So yes, there is conflicting information out there, I guess it is because it is a new thing here in AZ, but everybody is very helpful and curteous. Imconsider it a plus that we don't have to get involved in any of this, We justo hVe the oicenses

@Karl28 , sorry, the system didn't let me edit my last bungled up sentence:  I consider it a plus that we don't have to get involved in any of this, we just have to have the proper licenses, Airbnb does the rest. and like @Sabine42 said above, we can always see the details in our transaction history.

Good luck!

Hi Annette,

Where do I get the TPT license?  I have to remit for VRBO which I now realized that they do not collect and remit for me like Airbnb.  Melissa in Phoenix

 

Thanks for your help! I'm applying for my business license and am wondering if AirBNB falls under Vacation Rental or a 'regular' kind of license in Prescott?

altho airbnb collects tax, in my case they did not collect enough.  our tax burden in bisbee, with state and county is 15.10%.  air collected 13%. 

doing some digging i have found out that the county and state tax is combined.  the city taxes are separate.

While Airbnb collects and remits, you still have to file at aztaxes.gov.  You may not owe anything but you still have to file

Paul398
Level 2
Williams, AZ

I have the same problem. I have had a TPT license for years and have always paid taxes on my own. I have been checking daily, and as of today no payments have been made on my behalf. How could they without my TPT #? I have called many times and no one can tell me, and certainly the tax division of Airb&b does not call like I have been told for about one month now. Very poor performance on Airb&b side.

Airbnb started collecting taxes in Arizona in 2017 (prior to that, I collected and remitted taxes).  At first I thought this was a nice feature until a guest pointed out that the tax assessed and paid was 13% of the rent and cleaning charges.  The effective rate is 6.325% as our property is not in the City of Prescott's taxing jurisdiction.  Even if it was, the tax would only be another 2%.  I have confirmed with state, county and city taxing authorities the proper transient taxes are 6.325%.  A professional property management tax service confirms the same tax rate.  

 

My effort to get a response from Airbnb began on 2-9-17 thorough various departments and providing screen shots of tax rates received directly from the state and tax service companies.  I have received promises of call backs, resolutions, research in process...  No less than eight contact efforts on my part.

 

This evening, February 28th, in an attempt to elevate to a supervisor the answers were "left for the evening,"  "the supervisor doesn't have the authority to issue a full refund," must be elevated to another department... Even though it is documented in their notes that both the host and guest agree to cancel with a full refund (including the Airbnb charge assessed to both host and guest).  I was suddenly disconnected from the customer service rep (Desarae) and am still awaiting a call back.  

 

And to those of you that have been assured to not worry, "Airbnb will take care of the taxes and the DOR," of your respective states when evidence of proper payment needs to be provided, my thoughts are with you-imagine what that will be like.  

 

In closing, I will forward my complaint and Airbnb's lack of response to the Arizona Department of Revenue and our governor who recently passed favorable legislation in our state to make shared lodging in Arizona more open and also restricted the various taxing jurisdictions in the state from assessing "pile on" taxes to permit this industry to grow in Arizona.  Greg from Prescott, AZ. 

Hi @Greg-Or-Lani0 , it sure seems like the authorities involved don't actually know themselves yet what exactly is involved. Depending on whom you get to talk to on the phone, you'll get different answers. As long as you are registered, and you are, I wouldn't sweat it too much, or put too much energy into it. I don't think you'll get any valid answers from Airbnb any time soon...

As it stand: when your guest mentioned 13%, were they brand new guests from 2017 where Airbnb started collecting? they might have gotten the amount confused with Airbnb's service fee, which is just about that amount to  guests. I went to your place and simulated a booking, and the tax comes out to  11.325% . ($64 is  11.325% of $565.00, which is the total rental and cleaning combined).

I had gotten a pamphlet from the city of Prescott, and for short term rentals of less than 29 days, it breaks down like this: 2%. for the city TPA, add 3% for transient city lodging, and  6.325 % for I state transient lodging. I agree with you that if you're outside of city limits of Prescott, the 2% and 3% charged might  be questionable. But so far, my guests haven't comlained about the tax charged, so maybe give it some time for all to figure it out. Since I don't do that many rentals, I signed up for yearly reporting, and when you report to the state, then the deduction code is 11-23, as Airbnb paid the tax but we still need to file a report.

hope this helps a bit,

happy  hosting!

it some time for all to figure it out...

And here is the screen shot of my simulated booking of your place:

 

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