It’s summertime, which is often the peak rental time for vacation homes. If you’re one of the Indiana renters that is putting your house or a room up for rent, remember new taxes went into effect on July 1, 2019.

The new legislation requires individuals who put their homes or rooms up for rent for short periods of time to remit sales tax and any applicable county innkeeper’s tax.

If you are renting your space through an online site such as AirBnb or Vrbo, those sites are considered marketplace facilitators. Marketplace facilitators will collect and remit sales tax and county innkeeper’s tax for you.

If you are using your own website or posting a listing on a website like Craigslist, there are a different set of rules for you.

• If you rent your space for 15 days or more in a calendar year – you will need to register with DOR as a retail merchant and collect sales tax and any applicable county innkeeper’s tax.
• If you rent your space for less than 15 days in a calendar year – your rentals are exempt from Sales Tax and Innkeepers Tax. NOTE: If you rent your space for any amount of time on a marketplace facilitator then the rentals are no longer exempt from tax and you must collect tax on the next rental you make.

Contact your Somerset CPA Tax Advisor to discuss further if you need assistance registering with the Indiana Department of Revenue.