airbnb on white board

All lodging marketplaces are now required to collect and remit state and local taxes on short-term rentals in Wisconsin.

As of Sept. 23, 2017, under State Budget Act 59, marketplace providers of short-term residential lodging (e.g., Airbnb, VRBO) in Wisconsin are required to register with the Wisconsin Department of Revenue and collect and remit state taxes and local taxes on rooms and short-term rentals. The act also makes it clear that municipalities are entitled to impose a local tax on such lodging marketplaces and short-term rental owners.

According to Act 59, a lodging marketplace must collect state and applicable local sales and use taxes from the occupant and remit them to the appropriate departments when short-term rentals are rented through the lodging marketplace. The lodging marketplace must also notify the owner that the taxes have been collected and remitted.

Wisconsin requires any person who maintains, manages, or operates a short-term rental for more than 10 nights per year to:

  • Obtain a license as a tourist rooming house from the department of agriculture, trade, and consumer protection
  • Obtain (as required by ordinance) a license for conducting such activities from a political subdivision

Additional requirements may be imposed at the local level. For example, for residential dwellings rented more than six but fewer than 29 consecutive days, a political subdivision may limit the total number of days within a 365-day period that a dwelling may be rented to 180 days. See Act 59 for additional details.

Airbnb has been collecting and remitting applicable state lodging taxes in Wisconsin since July 1, 2017, under an agreement reached with the state earlier this year. Between July and September 30, it collected approximately $550,000 in tax revenue — an astonishing amount by all accounts. However, that agreement did not encompass local lodging taxes, which Airbnb is now required to collect.

Tax automation software facilitates lodging tax compliance for property owners. Learn more.

photo credit: OuiShare Summit 2012 via photopin (license)