The Short Term Vacation Rental Tax Is Back — With a flurry of last-minute activity, the Massachusetts state legislature has passed and sent to Governor Baker the new short-term vacation rental tax.
This lodging tax for vacation rental homes will apply to most new Martha’s Vineyard vacation home rentals for this coming summer, AND it will add another 10 to 12% to the cost of rental homes on Martha’s Vineyard.
Short Term Vacation Rental Tax Rates
The governor is expected to sign the bill into law in the next few days. The new tax will go into effect for all vacation home rental leases signed on or after January 1st, 2019, and will apply to rental stays beginning on July 1, 2019.
The new tax has both a state and local tax component. The new state tax rate is 5.7%. In addition, each town or city’s existing hotel lodging tax will be added on. On Martha’s Vineyard, Edgartown and Chilmark, will both have a short-term vacation rental tax rate of 9.7%, while the new tax rate in Vineyard Haven and Oak Bluffs will be 11.7%. Those rates could change, but that is what is currently expected.
Beat The Short Term Vacation Tax
Is there any way to avoid paying this new short-term vacation rental tax if you plan to rent a Martha’s Vineyard vacation home in summer 2019? Yes, book your home and sign your lease by December 31, 2018! You have just over a week to go.
Point B Realty has a number of great vacation rental home options for 2019 that are still available. The Rental Team can easily match you with a perfect place for 2019. You can email or call us at 508-627-4567 ext 1. Search all our vacation rental homes.
What If I Already Have A 2019 Rental?
If you are a repeat rental customer on Martha’s Vineyard who has already locked in their home or someone who has already signed a lease for next year, anticipating the coming tax changes, congratulations. You’re all set for 2019. No short-term vacation rental tax for you this coming year.
Who Pays The Short Term Vacation Tax?
The rental customer will be paying the new short-term vacation tax. It will be an additional fee on top of whatever your rental home costs. It will be very similar to the kind of bill you would receive when you stay at a hotel.
If you rent your home thru Point B, we will collect the tax as part of our lease process. We have a very sophisticated new property management system that automates the tax collection and processing for us. For landlords who also rent their home on their own, they will be responsible for collecting and reporting taxes for any of those leases separately.
What Comes Next
The earlier version of the short-term vacation rental bill had a number of other components. We are still waiting for some details on what will happen there. The Department of Revenue, which sets all the actual taxing policies and guidelines, has not been heard from yet either. Many have questioned how all the details can be put in place, with less than 10 days to go, and during a holiday week no less. Stay tuned for details as we get them.