Vacation rental hosts responsible for collecting Palm Beach County tourism tax, state Supreme Court action confirms

Short-term rental hosts, not platforms such as Airbnb, are responsible for collecting Palm Beach County tourism taxes from guests, the Florida Fourth District Court of Appeal ruled earlier this year. That ruling was recently affirmed by the state Supreme Court when it declined to hear an appeal from Palm Beach County Tax Collector Anne Gannon challenging the earlier ruling.

In the original lawsuit, Gannon had argued that short-term rental platforms should be considered “dealers” under state law, which would require them to collect and remit the tourism development tax (TDT). The Fourth District Court of Appeal ruled that the platforms don’t qualify as dealers.

Short-term rentals in Palm Beach County, like hotels, are required to collect TDT from their guests and pass the tax on to county officials. Hosts must create a TDT account with the Palm Beach County Tax Collector's Office and obtain a local business tax receipt for each rental property.

Last year, Airbnb and HomeAway agreed to require Palm Beach County vacation rentals on their sites to include tourist development tax and business tax receipt numbers.

The platforms agreed to share listings information with the county, which checks the numbers to make sure they’re valid. Listings with invalid tax numbers are removed from the sites.

In addition to collecting county taxes, Palm Beach County hosts must also get a Florida Vacation Rental Dwelling License, obtain a state tax certificate, and collect state taxes.

Airbnb and HomeAway (and HomeAway affiliate Vrbo) automatically collect state taxes when guests pay. However, Airbnb does not collect Palm Beach County tax on behalf of its hosts. Vrbo does collect the tax, but sends it back to hosts to remit to the county.

Palm Beach County hosts must complete all registrations and file county tourism tax returns themselves. MyLodgeTax can help short-term rental hosts automate and simplify lodging tax compliance at the county and state level, including tax registration and filing.

Meanwhile, in a victory for the city government of Miami Beach, an appeals court recently ruled that the city’s short-term rental law can stand, although with lower fines. Miami Beach city commissioners recently passed a new short-term rental fine structure designed to bring the fines into compliance with state law.

Vrbo and Airbnb collect state and Miami-Dade County lodging taxes on behalf of Miami Beach hosts, but they don’t collect city taxes, so hosts are responsible for taking care of those themselves.

For more on vacation rental lodging taxes in Florida, see our state Vacation Rental Tax Guide. If you have tax questions related to vacation rental properties, drop us a line and we’ll get back to you with answers.