Massachusetts Legislature Passes Short-Term Rental Bills

The Massachusetts House of Representatives and Senate passed legislation to tax and regulate short-term rentals, including Airbnb and other similar platforms.

The House bill, H.4327, imposes three different tax rates on short-term rentals, depending on the number of units. Residential hosts renting two or fewer units would be taxed at 4 percent; investor hosts with three to five units would have a 5.7 percent tax; and professionally managed hosts renting six or more units would face an 8 percent tax per rental.

The House bill also allows municipalities to create a local excise tax on certain short-term rentals. Half of the local tax collected from professionally managed hosts would be dedicated to either local infrastructure needs or low- and moderate-income housing programs. An amendment filed by Representative Kevin Honan and adopted would require that at least 25 percent of that tax money be distributed to housing programs.

The Senate bill, S.2400, extends the existing state hotel lodging tax of 5.7% on short-term rentals and allows an option to municipalities to impose regulations and a local excise tax.

 

Update on April 11, 2018:

A conference committee has been appointed to reconcile the differences between the bills. Reps. Aaron Michlewitz and Sen. Michael Rodrigues will lead the committee. Reps. Sarah Peake and Jay Barrows and Sens. Karen Spilka and Ryan Fattman will also serve on the conference committee.