Airbnb to Collect Illinois Hotel Taxes, January 2016
- Dec 22, 2015 | Gail Cole
Airbnb will collect the same 11.9% Illinois state tax that hotels collect and remit, beginning January 15, 2016. The company has been collecting the local Chicago hotel tax (4.5%) since February 2015.
Accommodations booked through Airbnb have always been subject to applicable state and local taxes. However, the company initially put the onus to collect on hosts. Without access to booking information, state and local governments have found this new lodging tax compliance challenging to enforce.
Under the new policy, Airbnb will automatically process applicable state and local taxes in Illinois. According to a company blog post, “We’re happy to be taking this important step that helps our host community and makes Illinois stronger.”
Come mid-January, Airbnb properties in Chicago will be taxed at a rate of 16.4%, just like Chicago hotels.
A few months later, on May 1, the rate for hotels will increase to 17.4% due to Cook County’s recently approved 1% hotel assessment. According to Crain’s Chicago Business, Airbnb has not yet indicated whether or not it will collect that additional tax.
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