Summit County, Colorado, creates new short-term rental zoning and licenses

The Summit Board of County Commissioners has approved new rules for short-term rentals, ending a 90-day moratorium on issuing vacation rental licenses the Colorado county passed in September.

Under the latest regulations, the county has created two short-term rental overlay zones, with different license types and rules for each.

The Resort Overlay Zone includes Keystone, Copper Mountain, Tiger Run Resort, and unincorporated areas at the base of Peak 8 in Breckenridge. Short-term rentals with a resort license have no restrictions on the number of nights per year they can be rented. Occupancy is limited to the greater of either two people per bedroom plus four, or one person per 200 square feet of living area. 

In the Neighborhood Overlay Zone, occupancy is limited to a maximum of two people per bedroom plus two. This zone has three different types of licenses:

• Type 1: The property owner must live at the property as their primary residence. There is no limit on the number of nights the owner can offer short-term rentals while they’re present at the property. Owners may rent out the entire home for short terms while they’re away for a maximum of 60 nights per year.
• Type 2: Short-term rentals are limited to 135 nights per year.
• Type 3: The property owner must get approval for a Conditional Use Permit (CUP) from the county Planning Department. This license allows short-term rentals of more than 135 nights per year if the property meets certain conditions.

Hosts in Resort Zones with active short-term rental licenses as of December 16, 2021, will have their licenses converted to Resort Licenses during regular renewal in September 2022. Hosts in Neighborhood Zones with active licenses or applications as of December 16, 2021, will have until September 2025 to convert their license to one of the new types.

Going forward, the county will explore the idea of introducing “hybrid zones” that would fall somewhere between residential and resort zones in terms of short-term rental requirements.

Summit County originally passed short-term regulations in 2018. Among other rules, vacation rental hosts must:

• Register with the city annually
• Designate an agent responsible for responding to problems with the rental within an hour
• Follow safety, occupancy, and parking rules

Short-term rental hosts in unincorporated Summit County must also register for a tax license with the state and collect state sales tax from guests. Hosts are responsible for collecting all required taxes and submitting them to the proper tax authorities, unless their short-term rental marketplace collects taxes for them. In Summit County, Airbnb and Vrbo automatically collect state tax for their hosts. Even if a rental marketplace collects lodging taxes, Colorado hosts are still required to register for a state tax license and file regular lodging tax returns. 

MyLodgeTax can automate and simplify short-term rental tax compliance, including registration and filing with state and local tax authorities. For more on short-term rental taxes in Colorado, see our Colorado 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.