Lodging Marketplace License Common Questions

  1. What is a lodging marketplace?

  2. I am offering short-term lodging in Wisconsin. Who is responsible for collecting and paying sales tax?

  3. Is short-term lodging subject to county and stadium tax?

  4. What about local room taxes?

  5. How do I know if the marketplace I am working with is collecting tax on my behalf?

  6. What is nexus?

  7. What is the occasional sales exemption?

  8. Is the lodging marketplace license the same as the seller's permit?

  9. If I know an individual is renting their home and is not collecting and remitting sales tax, what should I do?

  1. What is a lodging marketplace?

    A lodging marketplace is a person or business that (1) provides a platform used by an unaffiliated 3rd party to offer the short-term rental of a residential dwelling for a fee, for fewer than 29 consecutive days, and (2) collects the consideration for the rental from the occupant.

    If the lodging marketplace has nexus with Wisconsin, the lodging marketplace must:

    • Register for a lodging marketplace license (Form S-231).

    • Register for a Wisconsin seller’s permit with the Department of Revenue (DOR) if the marketplace does not have a Wisconsin seller's permit.

    • Collect Wisconsin sales and use taxes from the occupant and forward to DOR.

    • Contact each Wisconsin municipality in which it makes short-term rentals to determine if additional registration is required.

    • Collect applicable Wisconsin municipal room taxes from the occupant and forward to the municipality.

    • Notify the owner of a short-term rental that taxes were collected and forwarded the appropriate taxing authorities.

  2. I am offering short-term lodging in Wisconsin. Who is responsible for collecting and paying sales tax?

    Homeowners or other individuals who make rooms or lodging available to the public for periods less than one month are responsible for collecting and paying sales tax on sales of short-term lodging in Wisconsin. This includes the short-term rental of a home, room, apartment, cabin, inn, motel, or any other building in which accommodations are made available to the public. "One month" means a calendar month or 30 days, whichever is less, counting the first day of the rental and not counting the last day of rental.

    However, if you offer to rent short-term lodging on a lodging marketplace website, the lodging marketplace may be required to collect the tax and forward it to the appropriate taxing agency. If the lodging marketplace collects the tax, you do not need to collect the tax on those sales.

    See examples below.

  3. Is short-term lodging subject to county and stadium tax?

    Short-term lodging is subject to the 5% Wisconsin sales and use tax. It may also be subject to the following taxes administered by the Wisconsin Department of Revenue:

  4. Am I required to collect local room taxes?

    Contact the local municipality in which you offer short-term lodging to determine if additional registration requirements apply.

  5. How do I know if the marketplace I am working with is collecting tax on my behalf?

    See Lodging Marketplace License for the list of marketplaces who have registered with us for a lodging marketplace license.

    If the marketplace you are working with is not on this list, review your agreement with the marketplace. If the agreement does not state that the marketplace will collect the tax, ask the marketplace if it will be collecting the tax.

    If the marketplace is required to collect tax on short-term residential lodging (e.g., has nexus with Wisconsin), the marketplace must collect tax from the occupant, forward the tax to the appropriate taxing authority, and notify the owner of the short-term residential lodging that the marketplace has collected and forwarded the taxes. If the marketplace does not collect the tax, you are responsible for collecting and remitting the tax.

  6. What is nexus?

    Nexus, for Wisconsin sales and use tax purposes, is the connection between a seller and Wisconsin that requires the seller to collect tax on sales made in Wisconsin. Examples of activities that create nexus in Wisconsin include, but are not limited to:

    • Having physical presence in Wisconsin (e.g., employees or property)
    • Delivering products into Wisconsin in company-owned vehicles
    • Selling, servicing, repairing, or installing products in Wisconsin
    • Performing construction activities or other services in Wisconsin

    See nexus (e.g., engaged in business) provisions at sec. 77.51(13g), Wis. Stats.

  7. What is the occasional sale exemption?

    Starting with sales made in 2018, you are not required to hold a seller's permit if your taxable sales are less than $2,000 in a calendar year. Prior to 2018, a $1,000 threshold applied.

    If a seller holds or is required to hold a seller's permit, its sales do not qualify as exempt occasional sales (with an exception for persons who hold a seller's permit solely for bingo sales).

  8. Is the marketplace lodging license the same as the seller's permit?

    No. The license is for a person providing a platform used by others to offer short-term residential lodging. The permit is for a person making taxable sales in Wisconsin. If you are required to register for a lodging marketplace license, you must also have a Wisconsin seller's permit. You may register for a Wisconsin seller's permit at tap.revenue.wi.gov/btr.

  9. If I know an individual is renting their home and is not collecting and remitting sales tax, what should I do?

    Complete Form P-626, Wisconsin Tax Information Referral Form. You may email, mail or fax the form to us. More information is available at https://www.revenue.wi.gov/Pages/FAQS/ise-fraud.aspx.


Examples

Home-owner sells lodging using third-party website. Jane purchases a cabin in Door County. She rents out the cabin for a 14-day period using a third-party's website. The occupant pay Jane $2,200 for lodging.

Does Jane need to apply for a lodging marketplace license?

No. Jane does not need to apply for a marketplace license because she does not provide a platform through which others offer short-term residential lodging. However, Jane is selling taxable lodging. If the third-party website does not collect the taxes from the occupant, Jane must register for a seller's permit and remit applicable taxes to the Wisconsin Department of Revenue.

Jane should contact her municipality to determine if local municipal room tax or additional registration requirements apply.


Home-owner sells lodging using own website. During 2018, John plans to rent his home each weekend of home football games. He plans to advertise the weekend rentals on his website.

Does John need to apply for a lodging marketplace license?

No. John does not need a lodging marketplace license. He does not provide a platform used by an unaffiliated third party to offer short-term residential lodging. If John's sales of short-term lodging qualify for the occasional sales exemption (do not exceed $2,000 for the calendar year), he is not required to hold a seller's permit. He should contact the municipality to determine municipal requirements.


Real estate company. A real estate company provides a website used by clients to offer short-term residential lodging. The real estate company has nexus in Wisconsin and collects payment for the rentals from the occupants.

Does the real estate company need to apply for a lodging marketplace license?

Yes. The real estate company is providing a platform used by an unaffiliated third party to offer short-term residential rentals. The real estate company must register for a lodging marketplace license and a Wisconsin seller's permit to collect applicable taxes. Municipal requirements may also apply.


FOR MORE INFORMATION PLEASE CONTACT:

MS 5-77
WISCONSIN DEPARTMENT OF REVENUE
Customer Service Bureau
PO Box 8949
Madison, WI 53708-8949
Phone: (608) 266-2776
Fax: (608) 267-1030
Email additional questions to DORSalesandUse@wisconsin.gov

January 10, 2018