News & Events

Short-Term Residential Rentals Follow-up

As a follow-up to a post we shared on our social profiles on June 18, 2015 regarding Rhode Island vacation home renters, there have been some adjustments made to the originally proposed tax verbiage. Here is the signed tax change as it now stands:

house for rentSHORT-TERM VACATION RENTALS: Someone who rents out an entire house, an entire beach cottage, an entire condominium, an entire apartment, or other such accommodation, for a period of 30 days or less must register with the Division of Taxation for a sales permit and pay the required annual $10 fee; charge the 7 percent sales tax and 1 percent local hotel tax, for a total of 8 percent, on the transaction; and send the tax collected to the Rhode Island Division of Taxation. The following exception applies only for 2015: If one rents out an accommodation as described above, but a written contract for the rental is signed before July 1, 2015, the tax provisions do not apply for occupancy in 2015 – no matter when the tenants paid or will pay for the rental.

The Division of Taxation has been providing a series of outreach seminars to help explain the new law dealing with taxation of short-term residential rentals, vacation homes, beach cottages and on-line room rentals. While they have already held three sessions, a fourth seminar is scheduled to be held at the Newport Hyatt on Goat Island on July 8, 2015 from 9:00 a.m. to 11:30 a.m. Both the session and parking are free. To register, please email or call 401-845-9110. All of your questions will be addressed at the seminar.

Note: On July 15, 2015, The Rhode Island Division of Taxation posted some “Frequently Asked Questions” to aid homeowners, real estate professional and others regarding the recent extension of the sales and hotel taxes to short-term residential rentals, including vacation homes. To view the FAQ [click here].