“I didn’t know” will no longer be an excuse for local Airbnb owners.
Valid or not, that is likely the excuse the 85 percent of short-term vacation rental owners who haven’t been paying Hamilton County’s 4 percent lodging tax would give for not paying the government its fair share.
Recently, though, the office of the Hamilton County trustee reached an agreement with Airbnb that will allow the short-term rental website to collect the tax from its operators. The city of Chattanooga reached a similar agreement with the company in January.
Rental collections, according to Trustee Bill Hullander, could rise from $90,000 a year to nearly $7 million.
“I didn’t know,” according to a 2016 survey by the National Association for the Self-Employed, was the reason 34 percent of sharing economy participants gave for not knowing they needed to pay taxes. In addition, 36 percent didn’t understand what records they needed to keep for tax purposes, 43 percent didn’t set aside money to meet those obligations or know how much they owed, and 69 percent didn’t receive any tax information from the platform – like Airbnb – that they used to earn their income.