AIRBNB has announced that they will be collecting the LA City Hotel tax for LA hosts, effective 8/1/16. They all state that hosts are responsible for registering with the city. The problem is that the registration form makes you list all revenue you’ve made since establishing your business. I have been told privately by an AIRBNB rep “don’t worry about it,” but I would like some guidance in how to fill out the form and AIRBNB has refused to respond to 4 phone messages from me asking for advice, even off the record. Anyone out there know the answerAIRBNB has announced that they will be collecting the LA City Hotel tax for LA hosts, effective 8/1/16. They all state that hosts are responsible for registering with the city. The problem is that the registration form makes you list all revenue you’ve made since establishing your business. I have been told privately by an AIRBNB rep “don’t worry about it,” but I would like some guidance in how to fill out the form and AIRBNB has refused to respond to 4 phone messages from me asking for advice, even off the record. Anyone out there know the answer? I want to comply with the law, but I do not want to expose myself.
I can’t find anything on Google that says whether or not the LA TOT tax is retroactive. Since a previous post said that the city help line for these types of questions has a recording saying they are overwhelmed with calls, I think the best you can do is go to the taxation office in person and get an answer. However, I did find this site, which could be helpful to ALL hosts as it has a lot of information about 1099s and other tax issues: http://www.sharedeconomycpa.com/blog
Yes, the Los Angeles Transient Occupancy Tax is retroactive. When I registered, I was given five different answers by five different representatives about which tax I would need to pay and how often it was due. As I believed the tax was due quarterly (it is monthly) I was late. I had to pay interest and penalties. I also have experience working in finance of the Los Angeles City Business Tax. The city of Los Angeles actively searches for businesses that aren’t paying the tax and makes them pay retroactively.
Wow – depending on how long you’ve been hosting, that could be a HUGE tax bill. I would consult with a real estate attorney who specializes in short-term rentals. Or, if you can stomach losing your reviews, you could start your listing all over again, thus wiping out the past rentals. However, if you get caught … might be best to fully comply.
As I said, I have quite a bit of experience with various Los Angeles City taxes as I used to have to file them for my clients. I believe that consulting a real estate attorney would be a waste of money as Transient Occupancy Taxes are in fact due. An attorney can’t get you out of a tax obligation.
I think you answered your own question. Just fill it out honestly and pay the TOT. Your other option (lying) leaves you open to too much liability and you may loose your license.
I didn’t have a question.
oops, sorry, I just scrolled up and now realize I was addressing you as if you posted the original question. Sorry!
That would be a lot of money over 7 months , over 6K. As I said, I was told not to worry about it before. We are not supposed to pay that tax, we were supposed to collect it from our guests and pass it on.
Yikes! So your option is to try to collect the tax from all your previous guests? That’s not going to happen, of course. We are now being taxed (Boulder, CO) but Airbnb is not collecting it for us and I don’t think many hosts are actually complying so my conundrum is whether to charge the guests or treat it as a business expense (7.5% here). My nightly charge is high enough that I can absorb it – until my local Airbnb competitors start adding it to their nightly charge. Otherwise, I would probably lose out on bookings (if I add the tax). Ours is not retroactive, thank goodness.
(BTW, I am fully compliant with the new law and pay my taxes! I figure that I saved 7.5% for the first 15 months, as the law took place this past January)
It seems like every few weeks now someone pops up on this (public!) forum asking about tax evasion…
The city of LA has been very clear about how TOT policies apply to AirBnB for a long time now (since 2014 at least), so I really don’t see what kind of justification you could come up with for not paying back taxes. Like @EllenN I strongly encourage you to endeavor to pay all the back taxes (and potentially also fines) that you owe.
I agree completely. One of my friends who is also a liberal asked my why I registered and pay the Transient Occupancy Tax. He said that he would just ignore the tax if he were me. I told him that as liberals expect the government to provide services we are hypocrites if we evade taxes. I don’t want people to be able to lump me in with Timothy Geithner.
Lucy – your dome looks fantastic! Another destination to add to my list. BTW, how do I attach my listing to my profile, here?
Click the S in the upper right hand corner => click user name => Preferences => scroll way down to website. Enter your AirBNB URL and save. Done.
Thank you! Done post must be …
It’s 14% in Los Angeles, which is why airbnb cut a deal with the city to collect it. An airbnb rep told me in person “don’t worry about it” re back tax collection, but he didn’t tell me how to fill out the application, and when I called for help on that they have refused to return my calls.
When I registered; I tried calling the Los Angeles Office of Finance. I got so many different answers from different representatives that I went to the office and registered in person. Also, the website is not set up so that you can register short term rentals.
As EllenN stated, taxes are in fact due. I think you should be honest and pay them. Cost of doing business. I know it sucks.
yes, exactly! A couple of my friends who also host in Sonoma haven’t registered and don’t collect TOT, but instead donate $50 for each guest to a local housing charity. I really appreciate their sentiment, but - personally - i’d rather just pay the taxes and try to participate in the democratic process in a way that encourages the the county to spend that money in the best way possible.
Now, if i could somehow opt out of paying federal taxes that fund the military industrial complex it would be a different matter
Thanks Sandy! Your place looks gorgeous too. Hopefully one day I’ll make it to Boulder - a acquaintance of mine just bought a bookstore there (Trident I believe it’s called).