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Vacation Rental Tax in Massachusetts Has Become Law

Rental Tax for Massachusetts vacation rental owners changes

Posted 1/16/2019

The Massachusetts Short Term Rental Tax Bill has Become Law.

  • How does this law impact Cape Cod property owners?
  • How does this law impact Cape Cod vacationers?

At the very end of 2018, without much fanfare, Governor Baker signed into law a bill regulating and taxing short-term rentals. This new law provides for new taxes, a statewide registry, insurance requirements, and possibly safety inspections varying by town/city. It becomes effective on July 1, 2019.

If you are a vacation rental property owner on Cape Cod right now, you are probably feeling a bit overwhelmed and wondering how to prepare to meet all the requirements that the state is asking of you. Leighton Rentals can help you.

In the weeks and months to come, the Commonwealth and the Department of Revenue will be unveiling more details of this new law. We intend to stay on top of these announcements and keep our owners informed about all the details as they emerge, regarding property insurance requirements, property inspections, and all the other components of the new law.

If you are a vacationer hoping to visit Cape Cod this summer, you are probably concerned about how much this new tax is going to cost you. At Leighton Rentals, our website is updated to include the tax amounts, so you know exactly what your costs will be when you book with us, and don’t forget, if you book a spring or early summer vacation, with a stay prior to July 1, 2019 you completely avoid having to pay the tax!

At Leighton Rentals, we have been monitoring and preparing for the arrival of this tax for the past several years. We are ready to meet the challenges that this tax brings to our property owners and our vacationers.

Our computer reservation system is equipped to calculate and charge the appropriate taxes to tenants.

Our rental coordinators are knowledgeable about the tax and are able to fully explain to prospective tenants the details of the costs, as well as inform them that these monies which are collected get sent entirely to the Commonwealth of Massachusetts, and then to the individual appropriate towns here on Cape Cod. Leighton Rentals in no way benefits directly from this tax, nor do our property owners.

Our accounting team is prepared to remit the taxes on the owners behalf, at the appropriate intervals, to the state, taking the burden off the owners completely.

So whether you are a vacation property owner or a vacationer looking to spend your summer on beautiful Cape Cod, give Leighton Realty a call. We’re here to help!

Posted 10/11/2017

You may already be aware that vacation rental owners throughout Massachusetts may soon be subject to a rental tax 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.