New York State has imposed a sales tax on hotel occupancy charges. Effective April 2025, the definition of “hotel” for purposes of sales on occupancy charges includes short-term rental units offered by short-term rental hosts. A short-term rental host is a person or entity in lawful possession of a short-term rental unit who rents to tourists and transients for periods of less than 30 days. Short-term rental hosts will be required to register with the Department of State with limited exceptions. The registration will be valid for two years.
Impacted short-term residential units include:
- an entire dwelling unit,
- a room,
- a group of rooms,
- other living or sleeping space, or
- any other space within a dwelling.
The law also specifies the parties responsible for collecting and remitting the sales tax (e.g., booking services and short-term hosts). The registry is intended to create transparency into the short-term rental market activity in municipalities on a state-wide level. Municipalities with their own short-term rental registration systems may continue to use them, but short-term rentals in those municipalities will need to register with the state. The tax collection provisions apply to short-term rentals statewide, regardless of whether municipalities have their own registration systems.
More detailed compliance guidelines are expected to be issued prior to April 2025. For questions, please contact SAX’s State and Local Tax Leader, Richard Goldstein at rgoldstein@saxllp.com.