Airbnb to start charging tax in Iowa

It's going to cost a bit more to rent a room or a house through airbnb.  

The homesharing site announced today that its reached an agreement with the Iowa Department of Revenue to start charging state, county and local hotel and motel taxes.

The tax rate they'll be charging will be:

  • State Hotel and Motel Taxes (state excise tax)=5%
  • County Hotel and Motel Taxes=5-7% (depending on the county)
  • Local Hotel and Motel Taxes=2-7% (Depending on the municipality)

The company says the agreement will pump "hundreds of thousands" of dollars in tax revenue into Iowa.

The 970 active hosts in Iowa earned about $3 million in 2016 from airbnb.  In a news release, the company says there were 20,000 guest arrivals to Iowa via their app.

In addition, the company says most of their Iowa hosts are just renting a spare room out in their home.  They say that 16 percent are senior citizens, and 65 percent are females.  

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