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Florida Legislature will try to tackle short-term vacation rentals

  • Jan 10, 2018 | MyLodgeTax

When the Florida Legislature convenes today, regulating short-term vacation rentals will be on the agenda.

As in most states, short-term vacation rentals in Florida are regulated by a patchwork of local laws that differ greatly in requirements and enforcement. Florida lawmakers, including Senators David Simmons and Tom Lee, are gathering information about the industry to see whether statewide legislation could be a viable solution.

Some of the issues legislators are grappling over include market fairness for both the traditional hotel industry and home-based vacation rentals, safety and standards, individual property rights, neighborhood impacts, and lodging tax collection — issues that communities all over the country are also facing.

Tourism is the state’s No. 1 industry, and short-term vacation rental operators in Florida have capitalized on that. The number of vacation rental units in Florida has increased from 117,000 in 2012 to 131,000 in 2016. However, only 18,000 licenses are attached to those rentals. Some license holders are operating multiple properties under their licenses (in some cases, up to 75 units under one license), while others are operating illegally without a license at all.

Short-term vacation rentals on platforms including Airbnb, VRBO, HomeAway, and Gameday Housing bring visitors to the state for vacations and football game weekends. According to Airbnb, 2.6 million people used its platform to book a stay in Florida in 2017. In Tallahassee alone, 3,285 Airbnb bookings were made in just five home-game weekends in 2017.

Airbnb, the only online vacation-rental booking platform that collects lodging taxes on its Florida bookings, reports it paid $20 million in lodging taxes in 39 counties. Florida lodging tax rates are a combination of state and local rates and vary depending on the location of the rental. In many (but not all) areas in Florida, Airbnb collects lodging tax from guests on behalf of its hosts and passes it on to the state and/or local entity.

However, hosts are ultimately responsible for lodging taxes on revenues from their property, so they need to be aware of how to comply and exactly which taxes Airbnb collects and remits on behalf of hosts in their property’s location. For any taxes that Airbnb doesn’t handle on their behalf, or if they use other booking services such as VRBO or HomeAway, hosts need to collect and remit lodging taxes themselves — or use an automated solution to help.

Florida lawmakers’ new interest in regulating short-term vacation rentals highlights the fact that the vacation rental industry is becoming big business and no longer escaping the notice of government. Vacation rental hosts need to be prepared for stricter rules, more oversight, and tighter enforcement on every aspect of their business.

Lodging tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
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