Hospitable just rolled out a feature that can handle lodging taxes for hosts in all 50 states. Its property management software will register a property, calculate the tax owed, file the returns, and make the payment on bookings that come through direct sites, Vrbo, and guest upsells.
Lodging tax is one of the messier parts of running a vacation rental. Rates and rules change by state, county, and city, and the filing deadlines rarely line up. Last fall we covered a study showing how much this weighs on operators: hosts reported spending more than 50 hours a year on compliance, and nearly one in five had already been penalized.
What It Does
Once a property is set up, Hospitable calculates the tax by location, collects it from the guest at checkout, then files and makes the payment to the jurisdiction. Airbnb already does this in many areas, so the feature mostly helps hosts taking bookings off Airbnb, where direct booking has been climbing. It isn't new to the industry, either. Services like Avalara's MyLodgeTax have automated registration and filing for years; the difference is that Hospitable builds it into the platform instead of selling it as a separate subscription. The company says it has remitted more than $4.5 million in lodging taxes for hosts since launching its tax features.
What It Costs
The tax automation isn't priced on its own. It comes with Direct Premium, Hospitable's direct-booking plan, which takes a per-booking fee of 4% from the guest plus 3% from the host, or a 7% host-only option that leaves the guest's price alone. That sits on top of the regular subscription, which starts around $59 a month for two properties. Hospitable has added built-in features at no extra cost before, but here the cost is folded into what hosts already pay to take direct bookings.
What This Means for Hosts
This is most useful if you take direct bookings or Vrbo bookings, and especially useful if you have multiple properties across several tax jurisdictions. But if most of your stays run through Airbnb, Airbnb handles a lot of this automatically. Coverage is still expanding state by state, so confirm the filing details for your state and city.
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