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Must Pay Tax To Rent Out Your Home
Must Pay Tax To Rent Out Your Home 10/12/12
fbolton@cbs7.com
CBS 7 News Reporter
October 12, 2012
ODESSA, TX- With the increase of people in the Basin, many homeowners are looking for a way to earn a quick buck by renting out their homes and rooms for The Permian Basin International Oil Show.
But an unexpected fee to do this has their phones ringing off the hook.
"In surfing the web, I saw opportunity to make money this way and it looked like a great way to spend the weekend in Dallas," says Patrick Dolan, who’s renting out his home on craigslist.
The Texas Comptroller of Public Accounts says the money lessors make doesn’t only belong to the owner; a percentage must go to the state.
" Tax is imposed on a person, who pays for a room or a space in a hotel costing $15 or more a days. This applies to hotels, motels, bed and breakfasts, as well as condominiums, apartments and houses that they rent less than 30 consecutive days. It will be a 6 percent tax," says Press Secretary of The Texas Comptroller of Public Accounts Kevin Lyons.
The Texas Comptroller is searching online for those renting out their homes. They say this is eligible for "hotel tax" and the charge should be included in the price of the room.
But many lessors say this tax is unnecessary.
"I think this may be a little bit over board, when you've got once every other year a couple of dozen people renting out home space… that's much needed in the community to hold the event," says Dolan.
Now owners says they are thinking twice about the price they will charge others to rent out their room.
If someone doesn’t pay the hotel tax before November 20th, they will be fined a late charge penalty.