Renting rooms leaves homeowners owing taxes, commission says


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SALT LAKE CITY — Are homeowners breaking the law when they earn extra money by charging people for overnight stays in an extra bedroom?

Hundreds of Utahns use the website Airbnb to rent out rooms in their houses and condos for a night or two or more. It's a new way to connect people looking for a room for the night to people who have them.

Renters typically pay less than they would for a hotel room, and owners make a few dollars. But Utah lodging officials said tax dollars are getting sidestepped.

"It's not a new thing," said Jim Burgess, president of the Utah Hotel and Lodging Association. "I think it's just becoming more and more rampant as access gets easier."

He said he has no problem with people renting out spare rooms on sites like Airbnb, KSL.com or Craigslist if they pay the same sales and lodging taxes hotels, motels and bed and breakfasts do.

"They think it's only $1,000. It's not a big deal, and who's going to catch me?" Burgess said.

Charlie Roberts of the Utah State Tax Commission said, "We have auditors who review these websites and look for people who aren't paying lodging taxes."

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Roberts said in the past five years, the division has recovered $4.6 million in tax dollars from people renting out rooms online for overnight stays. His advice to anyone looking to make a little extra money this way is to pay the taxes now, before you get notice from his office saying you owe $5,000.

"Before anyone starts a business like this, they need to be aware of the law and that they're going to have to pay taxes," he said.

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