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Are ‘Love Motels’ evading taxes?

June 20, 2007

Honduran tax officials think they are.

Motel_sign_2
That Central American nation’s tax collectors have instituted Operation Fiscal Love, an effort to crack down on lodging establishments,
dubbed "love motels," that they believe earn more than they report.

The oversight, say officials, cheats the Honduran government out of about $40,000 a month in taxes. And they believe it comes primarily from customers who appreciate the inns’ clandestine charms.

Lovers looking for discreet trysting places check into these Honduran "no-tell motel" rooms that rent for as briefly as six hours. The Associated Press reports that "scores of the hotels are located on the outskirts of the country’s two
largest cities, Tegucigalpa and San Pedro Sula, charging between $15
and $45 per room."

While the couples keep their affairs hidden, investigators say the lodgings also are hiding those steamy proceeds.

So tax investigators are stationed inside the motel lobbies, as well as outside counting the parked cars to get an idea of how many clients each motel has.

The scrutiny is, of course, just to get accurate numbers to compare with the income that the motels are, or aren’t, reporting to the tax collector.

"We’re not interested in whether customers go into the rooms as a
twosome, threesome or foursome,” said Honduran tax office spokesman Armando Sarmiento. ”We’re only counting the cars that
arrive, not the people inside them.”

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TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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