Posted on January 4, 2018
Airbnb Tax Tips for Hosts in 2018
Filing federal and state taxes for Airbnb income can be overwhelming. If done incorrectly, you could be missing out on a lot of deductions that can save you tons of money. Here are some Airbnb tax tips that will help reduce your stress and save you money in 2018!
Record your Airbnb Expenses
Keep a running tally of your expenses throughout the year. I keep a file on my computer with the expense details (date, store, cost, and notes about the purchase). I also keep a folder of receipts to have a hard copy on hand.
By recording your Airbnb expenses as you incur them, you are less likely forget valuable deductions when it comes time to file your taxes!
What can Airbnb Hosts Expense?
Keep track of any expense that is related to your Airbnb business. At the end of the year, you’ll have a detailed list of expenses and a tax professional can advise you based on your specific situation.
Keep track of all your bills – electricity, water, gas, internet, tv, and phone. Some of these expenses can be fully deducted while others may only be proratable (especially for hosts who rent out guest rooms in their primary residence)
In order to assist your tax professional on how to correctly prorate these expenses, make sure you have an accurate count of the number of days your accommodations were rented and the portion of your home that the guests use (either by number of rooms or square footage).
Cleaning Supplies and Other Cleaning Expenses
- Toilet bowl cleaner
- Cleaning solutions
- Laundry detergent
If you hire a cleaning service, make sure you have a record of those payments too!
Bedroom, Kitchen, and Bathroom Supplies
Amenities you provide for your Airbnb guests in the bedroom, bathroom or kitchen can be considered business expenses.
- Toilet paper
- Shower essentials
- Paper towels
- Coffee and tea
- Trash bags
- Other consumables
- Bed Sheets
- Bath Towels
If you provide other things for your guests, keep track of those expenses!
Buying a bed set or memory foam mattress for your Airbnb guest room? It’s an expense! Even if you outfit your guest room on a tight budget, the tax deduction is worth it. Your tax professional will assist you with the correct way to deduct furniture expenses.
Did you make any other purchases for your Airbnb business? Landscaping expenses, handyman repairs, and even mailing a lost item to a previous guest are expenses you should be recording.
This expense is often forgotten. Do you make trips to the store for Airbnb supplies? Do you provide airport transportation for guests? Keep track of your mileage as you may be able to deduct this expense as well!
Use a Tax Profession or Reputable Tax Filing Software
Federal and State tax laws are constantly changing. This means the opportunity to miss deductions, make mistakes, and have inconvenient interactions with the IRS is more likely. Employing an experienced tax professional is a great way to ensure you are getting the most out of your tax return. If you are more comfortable with completing your taxes on your own, a tax filing software is a great way to go!