I have a good relationship with my State Rep and when I couldn’t find good answers I reached out to him and he got me in touch with the person responsible for implementing the law. We’ll see.
Ok - because when I contacted Sen Cyr’s office, they pointed me to Jennifer as being the official contact point person for this tax and its implementation and as i said, she’s the one listed on DOR site as such.
Oh don’t you just love Government. This the contact but he hasn’t gotten back to me yet.
Problem Resolution Office
Massachusetts Department of Revenue
I heard back from my contact and I am under-impressed.
I’m trying to get clarification but he’s actually trying to tell me that I have to collect a tax on the Airbnb fees I pay to Airbnb and the airbnb fees the guest pays directly to the Airbnb.
But he also says it is not Airbnb’s responsibility to collect the tax.
When I read the ruling, it states that we can enter into an agreement with the intermediary but we are the operators. It does not imply that Airbnb has collect this. And in fact they are not collecting taxes for any of my bookings in July.
- Can you provide a URL of where you are getting this copy:
So -to your other points: in ‘(a)’, it defines ABB or similar as the collector of payments and then in ‘(ii)’ and ‘(iii)’, they are required by word ‘shall’ as last word in ‘(a)’ to be the tax collector and remitter.
Also, if you want to take this to email, my contact is email@example.com
The actual law can be found at: malegislature dot gov/Laws/SessionLaws/Acts/2018/Chapter337
Yes, the guest booking fee to Airbnb IS taxable under the ‘service charge’.
We don’t actually pay a fee to Airbnb, but they reduce payouts by charging that 3% fee for CC.
And that will be implicitly taxed when it’s calculated on the gross amt of rent. So - we may need to charge a tad more to net the same amount we had before but with it being unable to charge other than whole dollars, that become a problem.
I have yet to see any ABB changes to support this but based on law as i read it, they will be required to.
Yay!!! I just checked my 2 Airbnb listings in Cambridge and did not see an “Add tax” button. When I drilled down and went to local laws, it said “Your listing is in Massachusetts State where Airbnb collects and remits occupancy taxes on your behalf.”
Now, I just have to worry about VRBO. I am concerned that VRBO stated that the taxes were included in the fee which they were not!
YAH! If Airbnb is doing it then I think VRBO will have to too. It’s the same state law.
@Lynick4442 That is what I think will eventually happen but VRBO official statement is: “It is the responsibility of the property owner to collect and remit the appropriate taxes for any jurisdiction their property is in.”
And they specifically told our August booking guest that all taxes were included in the original rental fee.
@pleasantforestshores Thank you for the Jennifer Desimone reference. I will try to contact her and see what our options are vis-e-vis this $445 tax that will be owed for our August rental. We are fortunate that our July rental is for 32 days so we don’t have to deal with the ambiguities.
I was away from Internet for last few days on my trip from FL but as to VRBO, I think it was their site that had a field for taxes BUT on a test I did, it wasn’t calculated on the service/booking fee which is required by law so until they make some changes, I’m not sure how you can deal with it other than contacting Jennifer at DOR and see if they can get VRBO to get act together?
@pleasantforestshores Thank you so much for steering me to Jennifer. I did talk to her and she not only helped me sort out steps with VRBO but she also forwarded my saga to state lawyers.
Then I figured out how to handle VRBO. I spent an hour and a half in a chat with them. The upshot was that I have blocked off all the remaining post-July 1 openings in VRBO so no more bookings can come through that platform until they have their act together. Then I sent an email to the August booking saying the following (see below). The guest has agreed to pay the extra fee which I will then submit to DOR in September.
What I wrote to the guest:
I am so sorry that you’ve been caught up in this SNAFU.
I decided that July 23 was pretty late to be waiting for a resolution to this question. I’ve been in touch with both the Massachusetts Department of Revenue and Expedia. They are both telling me that during this intermediary period before Expedia has the infrastructure in place to collect and remit taxes in Massachusetts, I will be responsible for collecting and remitting the taxes. Expedia says the email you received stating that the taxes were included in the fees was an automated email response so they are not willing to share in the cost of the taxes.
Expedia has suggested that I request an additional fee from you. That fee will be the taxes owed on the rental including the cleaning fee (a total of $408.59 in taxes). It will not include the taxes owed on their service fee. They will handle that portion of the taxes.
If you choose to cancel your reservation instead of paying the additional fee, I will refund the rental and cleaning fees 100%. I don’t know whether Expedia will refund their service fee or not.
To reiterate the details behind the 17.45% tax:
5.7% State excise
6% City excise
2.75% Convention center finance fee
3% Community impact fee
You can find these details on the Massachusetts DOR website under the heading “D. Collection and Remittance of the State and Local Excises; New Excises and Fees:”
And the Cambridge specific fees:
Glad I was able to help you out! So you have multiple units that forces you to charge the 3% CIF?
Addendum: I looked it upon Cambridge web site and see that they adopted both (a) and (b), and I was only thinking of (a). And in part of the city documents, it says that operator not occupant is the one who pays the 3% CIF…
@pleasantforestshores Both of the listings are connected to our Cambridge home. One is a guest room in our home and the other is an in-law apartment.
AirBnB is calculating a 17.45% tax against the guest so they are taxing the guest which is what I am doing with our August guest.
@carolynfuller About a week ago, i had another email exchange with Jen at DOR. Here’s the result from a post i made elsewhere on another forum:
You as host are NOT responsible for taxes on any Airbnb rental, THEY are.
In email from Jennifer DeSimone (MA DOR), she wrote: “The intermediary ultimately are the ones responsible for the taxes collected and reported, not the hosts. I will let our legal folks know about this and see about reaching out to Airbnb but again. This is probably going to take some time for everyone to settle in.”
In response to my final point on email to her regarding incorrect tax handling, where I wrote:
“Hopefully this type of thing won’t affect us because if they are supposed to charge tax and don’t, us as hosts don’t want to be held responsible for their mistakes!”