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Rental Tax for Massachusetts Vacation Rental Owners

Rental Tax for Massachusetts vacation rental owners

You may already be aware that vacation rental owners throughout Massachusetts may soon be subject to a rental tax (6%-12%) based on their rental income. This is similar to hotels, motels and bed & breakfast accommodations. Massachusetts legislators have been trying to no avail for several years through Bill H3454 to have this take effect, thereby increasing both state and town revenues.

The Massachusetts legislators met once again this summer and rejected the short-term rentals, despite several attempts to tax them. Our Governor Charlie Baker expressed support on this tax in 2016 was convinced the long term negative effects this would have and proposed a compromise with a three (3) tier system with rates dependent on rental frequency. This was also rejected.

However, legislators have not given up with the hope of increasing revenue thru tourism accommodations and they will discuss and consider this again next year.