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Philadelphia gets serious about enforcing STR law

  • Aug 8, 2023 | Jennifer Sokolowsky

The Philadelphia Department of Licenses and Inspections is cracking down on unlicensed short-term rentals (STRs) nearly seven months after a new STR law went into effect. The department announced July 12 that it’s requiring STR marketplaces such as Airbnb and Vrbo to delist properties that don’t have city-issued licenses. 

The enforcement effort began early this year when the city requested information from STR marketplaces via subpoenas to identify unlicensed properties. Delisting is the next step. The marketplaces are cooperating.

“For months, Airbnb has worked closely with the City of Philadelphia to ensure they have the necessary tools and support to effectively enforce their current rules, including the ability to identify listings that may be unlicensed for removal,” said Haven Thorn, an Airbnb spokesperson.

Vrbo “works with officials across the country to support regulations that address local needs,” said Tracie Robinson, a regional manager for the Expedia Group, which owns Vrbo.

According to the city, up to 1,700 STRs are currently operating in Philadelphia without a license. Only 452 operators have received a “limited lodging operators license,” which is required for properties where hosts live, and 209 operators have obtained hotel licenses, which apply to non-hosted properties. 

Hotel licenses can only be granted in parts of the city that are zoned for hotels. In non-hotel-zoned areas, operators must ask the Zoning Board of Adjustment for a zoning exception to get a hotel license. The board has a backlog of cases, resulting in long wait times for licenses.

The STR ordinance was approved in 2021, but enforcement was delayed twice to give hosts more time to comply.

In addition to the license requirements, STR operators must also follow other rules, including:

  • Properties cannot be occupied by more than three people (including the owner and renters) who aren’t part of the same family
  • Renters are only allowed to have guests between the hours of 8:00 a.m. and midnight
  • Excessive noise is prohibited
  • Units must have safety features such as smoke and carbon monoxide alarms

Philadelphia vacation rentals are also subject to lodging taxes that include Pennsylvania state hotel tax and city hotel tax. Short-term rental hosts are required to collect these taxes from guests, register with state and city tax authorities, and file lodging tax returns.

STR marketplaces are required to collect state hotel taxes on behalf of their listings. If all of a host’s transactions go through a marketplace, they are not required to register with the state or collect state lodging taxes.

Airbnb also collects city taxes for its Philadelphia hosts, but Vrbo does not. Hosts are required to collect and pay taxes that are not collected by their platform.

MyLodgeTax can help short-term rental hosts in Philadelphia simplify and automate lodging tax compliance. See our Pennsylvania Vacation Rental Tax Guide for more on short-term rental taxes in the state. If you have tax questions related to properties in Philadelphia, drop us a line and we’ll get back to you with answers.

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.
Avalara Author
Jennifer Sokolowsky
Avalara Author Jennifer Sokolowsky
Jennifer Sokolowsky writes about tax, legal, and tech topics. She has an extensive international background in journalism and marketing, including work with The Seattle Times, The Prague Post, Avvo, and Marriott.
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