Vacation Home Owner Need To Stay On Top Of Tax Rates

    taxesIf you own a vacation home that you rent out it’s your responsibility as the owner to stay up to date on tax rates. There can be a lot of confusion when it comes to collecting taxes on your vacation rental. Many homeowners are aware of income tax that needs to be paid as a part of renting out their home but are at not aware of other taxes such as hotel taxes or sales and room occupancy taxes. When advertising your vacation home listing always list the correct tax rate.

    As a property owner, you may not think of yourself as a hotel, but nearly every location in America requires a room occupancy tax or hotel tax. According to the State of New Jersey Department of the Treasury, a hotel/motel is a building that is regularly used and kept open for the lodging of guests, including bed and breakfasts, inns, etc. The State Occupancy Fee is imposed on the room rentals that are currently subject to the 7% New Jersey sales tax and is in addition to the sales tax. For more information on the state occupancy fee and sales tax in New Jersey visit here.

    Some municipalities choose to impose their own local taxes on occupancies such as Wildwood, Wildwood Crest, and North Wildwood for example, and the new State Occupancy Fee is imposed at a lower rate in those areas. It can be found here.

    Tax rates can change often and sometimes with little notice. As a homeowner, it is your responsibility to stay up to date.  If you receive bookings online be sure your advertised rate reflects the current tax rate.

    If you are looking to buy your own vacation home along the Shore we would love to help. We are experts in real estate from Ocean City to Cape May. Real estate is one of the biggest investments of your life and The Ferzoco Group knows what it takes for you to take that leap of faith in real estate. We provide you with the tools, professional service, and experience it will take for you to live the dream. Contact us today here, or give us a call directly at (609) 399-5454.

     

     

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