Avalara, Inc.

Do I have to register and obtain a business license?

Yes. Renting property is considered a business. To avoid penalties, you must obtain the proper business license(s) to rent it out legally. Avalara MyLodgeTax will identify which licenses and permits you need. Setup time varies as we coordinate with the appropriate tax authorities on your behalf. The cost for each license is the rental property owner’s responsibility.

Why would I need MyLodgeTax when I can do this myself?

It’s true that you can do this on your own without MyLodgeTax. When it comes to taxes, in general, the work involved becomes complicated, tedious, and prone to error when done manually. Much like income tax returns, people choose to pay someone else to do it for convenience, less risk, better accuracy, and to save money and time. Lodging tax compliance is no different in that way — and MyLodgeTax makes it so easy!

Do I really have to collect and pay lodging taxes?

Yes. Short-term renting of your vacation property triggers the requirement to collect and remit lodging taxes, which go by many names across the U.S. (e.g., occupancy tax, lodging tax, room tax, accommodations tax, bed tax, hotel tax). However, lodging taxes are different from the income taxes required by the IRS and the states, which are filed once a year.

Are there any exemptions to these taxes?

Exemptions vary by state, and some by city and county within a state. Non-profit groups, church/religious organizations, certain government officials, and universities are common groups that may be exempt from these taxes, but not always. Most states require the exempt organization to have an exemption certificate and pay with organization funds. county within a state.

Are there any fees or penalties if I decide to cancel?

No. You can cancel at any time without any obligation. However, you are still obligated to collect and pay these taxes.