HomeAway starts collecting lodging taxes for hosts in New Jersey
- Oct 4, 2018 | Jennifer Sokolowsky
HomeAway has begun collecting short-term rental taxes in New Jersey on behalf of its hosts. As of October 1, HomeAway collects state sales and hotel occupancy fees as well as state-administered city/county lodging taxes on its New Jersey bookings, including:
- Municipal occupancy tax
- Meadowlands regional hotel use assessment
- Sports and entertainment facility tax
- Atlantic City luxury tax
- Atlantic City promotion fee
- Cape May County tourism sales tax
- Cape May County tourism assessment
October 1 is also the date New Jersey’s new law applying lodging taxes to short-term rentals goes into effect. Prior to the law being passed this summer, short-term rentals were not subject to lodging taxes. Short-term rental operators are now required to collect state sales tax, hotel occupancy fees, and the Meadowlands regional hotel use assessment, where applicable, from guests.
Many cities in New Jersey also levy their own municipal occupancy taxes on hotels. The new law allows municipalities the option to impose new taxes and fees on short-term rentals, including municipal hotel occupancy tax, Atlantic City luxury tax, Atlantic City promotion fee, Cape May County tourism sales tax, Cape May County tourism assessment, sports and entertainment facility tax, and Meadowlands regional hotel use assessment.
New Jersey short-term rental operators must register with the state for tax purposes before they can start collecting lodging taxes from guests — unless all of their sales transactions go through an online rental platform or a real estate broker. In that case, the platform is responsible for collecting taxes and the operator does not need to register. However, if the host deals directly with the guest in collecting payment, the host is required to register with the state. Registration for short-term rentals will be available after October 8.
Hosts who are registered must regularly collect lodging taxes from guests and file regular returns with the state.
New Jersey is one of the few states where HomeAway collects more types of short-term rental taxes for its hosts than short-term rental giant Airbnb, which has tax-collection agreements with more than 300 jurisdictions across the United States.
However, HomeAway has added several jurisdictions to its tax-collecting list this year, including Idaho, Oregon, and Washington states; Los Angeles and Santa Monica, California; and Portland and Multnomah County, Oregon. On October 1, HomeAway also starts collecting state sales tax in Maine and tourist development tax in Pinellas and Orange counties, Florida.
In New Jersey, Airbnb only collects occupancy tax for its bookings in Jersey City. Airbnb hosts in Jersey City still have to collect and pay other taxes due on their rentals themselves. Short-term rental operators who use Airbnb in other New Jersey locations or who use other rental platforms that do not collect taxes on their behalf must take care of all tax obligations themselves.
Even when your short-term rental platform is collecting lodging taxes for you, you shouldn’t assume the platform is taking care of tax registration and filing. In most locations, rental platforms that collect lodging taxes do not file lodging tax returns on behalf of individual hosts. Instead, they pay a lump sum to the jurisdiction. That means it’s usually up to you to report the amount of lodging tax that has been collected and paid on your behalf.
MyLodgeTax can help simplify lodging taxes for short-term hosts in New Jersey by managing all registrations, filing, and payment.
