Lodging Marketplace License Common Questions



Examples

Homeowner 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 pays Jane $2,200 for lodging. The third-party website does not, directly or indirectly, process the payment from the occupant.

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. Prior to January 1, 2020, 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.

The tax treatment is the same if the cabin rental occurs on or after January 1, 2020. Jane is liable for Wisconsin sales or use tax on her sale of taxable lodging if the third-party website does not collect the taxes from the occupant. The third-party website is does not meet the definition of a marketplace provider, as defined in sec. 77.51(7i), Wis. Stats., since it does not, directly or indirectly, process the payment from the purchaser.

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


Homeowner sells lodging using own website. John plans to rent his home each weekend of home football games. He will 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.


Hotel or motel. A hotel located in Wisconsin rents out rooms and suites to travelers.

Does the hotel need to apply for a lodging marketplace license?

No. The hotel does not need to apply for a marketplace license because it does not provide short-term residential lodging. However, the hotel is selling taxable lodging. Therefore, the hotel must hold a Wisconsin seller's permit and collect applicable taxes. Municipal requirements (e.g., local room tax) may also apply.


Real estate company. A real estate company located in Wisconsin provides a website used by clients to offer short-term residential lodging. The real estate company 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.

If the sale occurs on or after January 1, 2020, the real estate company is a marketplace provider that is required to collect and remit tax on the sale of the short-term rentals that it facilitates on behalf of its clients (i.e., marketplace sellers).

See Marketplace Providers and Sellers for more information.


Applicable Laws and Rules

This document provides statements or interpretations of the following laws and regulations enacted as of January 2, 2020: Sections 66.0615, 73.03, Wis. Stats., Ch. 77, Wis. Stats., and Ch. Tax 11, Wis. Adm. Code.

Laws enacted and in effect after January 2, 2020, new administrative rules, and court decisions may change the interpretations in this document. Guidance issued prior to January 2, 2020, that is contrary to the information in this document is superseded by this document, pursuant to sec. 73.16(2)(a), Wis. Stats.

FOR QUESTIONS OR COMMENTS 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

Guidance Document Number: 100144

January 2, 2020