Memorial Day is the unofficial start of summer.
Millions will begin the annual vacation season this long holiday weekend.
Others will wait a few weeks or months before taking a break from work.
Regardless of timing, all these travelers will need places to stay.
Nowadays, more vacationers are using short-term rentals of private homes or apartments.
They like the hominess and feeling like a local. They also often can get good deals.
But one thing is the same in most cities and states for local rentals or hotels: taxes.
Levies for sleeping over: Yep, when a homeowners lease their houses or condos, in many jurisdictions they generally are supposed to comply with state and local occupancy tax laws.
These charges go by a variety of names. Lodging tax. Bed tax. Transient occupancy tax. Hotel tax.
Whatever they're called, these levies can add a sometimes surprisingly large amount to the price of staying in a private residence or traditional hotel or motel.
Too often, these extra charges are a shock when it comes time to settle your bill.
State occupancy tax rates: To prepare you for what might show up on your final accommodations' statement, especially if you stay in a hotel, here's a look at each state's lodging tax, according to data from the National Conference of State Legislatures (NCSL):
|
Alabama |
4% |
|
Nebraska |
1% |
|
Alaska |
NA |
|
Nevada |
NA |
|
Arizona |
5.5% |
|
New Hampshire |
9% |
|
Arkansas |
2% |
|
New Jersey |
5% |
|
California |
NA |
|
New Mexico |
NA |
|
Colorado |
NA |
|
New York |
NA |
|
Connecticut |
15% |
|
North Carolina |
NA |
|
Delaware |
8% |
|
North Dakota |
NA |
|
District of Columbia |
14.95% |
|
Ohio |
NA |
|
Florida |
NA |
|
Oklahoma |
NA |
|
Georgia |
$5 per room |
|
Oregon |
1.8% |
|
Hawaii |
10.25% |
|
Pennsylvania |
6% |
|
Idaho |
2% |
|
Rhode Island |
5% |
|
Illinois |
6% |
|
South Carolina |
2% |
|
Indiana |
NA |
|
South Dakota |
1.5% |
|
Iowa |
5% |
|
Tennessee |
NA |
|
Kansas |
NA |
|
Texas |
6% |
|
Kentucky |
1% |
|
Utah |
0.32% |
|
Louisiana |
NA |
|
Vermont |
9% |
|
Maine |
9% |
|
Virginia |
0% |
|
Maryland |
NA |
|
Washington |
NA |
|
Massachusetts |
5.7% |
|
West Virginia |
NA |
|
Michigan |
6% |
|
Wisconsin |
NA |
|
Minnesota |
NA |
|
Wyoming |
NA |
|
Mississippi |
NA |
|
Puerto Rico |
9% |
|
Missouri |
NA |
|
Virgin Islands |
12.5% |
|
Montana |
4% |
|
|
|
Jackson Brainerd, a policy and research analyst at the NCSL, has more details on state lodging tax rates and applicable state sales taxes, as well as some of special tax situations.
For example, notes Brainerd, Alabama's 4 percent lodging tax goes to 5 percent in the state's mountain lakes area.
Sales and other taxes, too: You caught that reference above about sales taxes, right?
Yep, in addition to an occupancy tax, lodgings also are generally subject to a state's sales tax, as well as any more-local, such as city or county, lodging and/or sales taxes.
Sometimes specialty taxes for specific state or local projects or other taxing districts are tacked on, too.
That's why hotel bills have so many lines for just one night's stay.
And you thought it was the room service and minibar that was going to bust your travel budget.
You also might find these items of interest:
- Airbnb collecting occupancy taxes for more of its clients
- Pay your big tax bill if you want to travel internationally
- Taxes are part of travel, but at least many business trip expenses are deductible
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Warren
As someone who travels a lot (39 weeks just for work last year), my basic rule-of-thumb is to take the nightly rate and multiply by 1.25 to get the actual final cost (25% is a close-enough approximation for taxes, fees, and surcharges) – plus whatever the hotel may charge for parking (if they do, and I’ll have a car).
I really wish hotels would show final cost the way airlines have to now: because I’m stuck paying those taxes regardless of whether the “room” is $100 or $300 a night – and regardless of whether it’s Rick’s Roadside or the Ritz Carlton.
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