Last updated on March 10th, 2026
Clients often come to us with questions regarding sales tax on short-term rentals—we’re here to answer those questions for you. In brief, short-term rental units in New York are subject to the same sales tax requirements as hotels. Owners and operators who do not use a booking service must charge sales tax on sales of short-term rental unit occupancy when the rental rate exceeds $2.00 per unit per day. Booking services such as Airbnb and VRBO generally collect and remit sales tax directly on behalf of hosts. Whether you use a booking service to facilitate sales or not, you should be aware of the requirements related to sales tax for short-term rentals in New York State.
What is considered a short-term rental?
A short-term rental unit is defined as all or a portion of a building used for the lodging of guests. Short-term rental units include (but are not limited to) all or a portion of the following:
- a house
- an apartment
- a condominium
- a cooperative unit
- a cabin, cottage, or bungalow
- a similar furnished living unit
Requirements for Owners and Operators of Short-Term Rentals
Booking services and certain operators of short-term rentals located in New York are required to:
- Register as a sales tax vendor through New York Business Express
- File sales tax returns
- Collect and remit the sales tax and unit fee (if applicable)
Exceptions: When You Don’t Need to Collect Sales Tax
- Operators of short-term rentals in New York State are exempt from collecting sales tax if rent out their property for three days or less in the calendar year and do not use a booking service to facilitate the sales.
- Operators are exempt from collecting sales tax if a booking service facilitates all sales of unit occupancy. In this case, the booking service must provide the operator with a Booking Service Certificate of Collection or a publicly available agreement stating that the booking service will collect sales tax and unit fees.
- An operator does not need to charge sales tax for guests who are permanent residents. A guest is considered a “permanent resident” once that guest has stayed in the rental unit for at least 90 consecutive days. Guests are required to pay state and local sales tax until that time. However, in New York City, a guest must continue to pay local sales tax until that guest has stayed in the unit for at least 180 consecutive days. Once permanent residency is established, the unit operator may credit the guest’s account or refund the tax already paid.
- Purchasers who provide an operator with a completed exemption certificate are exempt from paying sales tax on unit occupancy. Examples of guests that qualify for an exemption include certain organizations such as charitable organizations, youth sports groups, and religious groups, federal and New York State government employees traveling on official business, and authorized representatives of veterans posts or organizations.
Reach out to Our Real Estate Accounting Team for Guidance
If you own or operate a short-term rental unit in New York, it’s important that you’re aware of your obligations regarding sales tax. RBT CPAs’ real estate accounting team can help you navigate this and all other tax and accounting-related matters. Give us a call today and find out how we can be Remarkably Better Together.