Montgomery County, MD Hotels & Lodging: Transient Occupancy Tax (2026)
Key Facts
- Tax rate
- 7% of room rental charge
- Reporting
- Monthly, or quarterly if approved
- Records retention
- 3 years
- Enforcing agency
- Director of Finance
Summary
Montgomery County taxes hotel and motel room rentals at 7 percent of the total room charge, collected by the hotelkeeper and remitted monthly to the Director of Finance.
The Director of Finance must impose on each transient a tax at the rate of 7 percent of the total amount paid for room rental, by or for the transient, for sleeping accommodations in any hotel or motel that is located in the County. ... Room rental means the total charge required to be paid by a transient for a sleeping accommodation. Room rental includes any service fee, broker's fee, or other charge or fee required to be paid by the transient regardless of what the charge is called.
Official source re-checked September 7, 2026: no newer edition of the code had been published (publisher’s edition: 2026 S-90: Montgomery County Code contains legislation effective through May 7, 2026 | Zoning Updated Effective: April 13, 2026 | COMCOR Regulations effective as of July 1, 2026).
Full Breakdown
Under County Code Section 52-16, the Director of Finance imposes a 7 percent tax on the total amount paid for room rental at any hotel or motel in the County. "Hotel or motel" is defined broadly to include hotels, motels, tourist homes, rooming houses and other lodging places offering compensated sleeping accommodations to a "transient" (someone staying 30 or fewer consecutive days): language broad enough to reach short-term rental hosts acting as hotelkeepers. Hospitals, nursing homes, and 501(c)(3) facilities used mainly for something other than overnight guests are excluded. Hotelkeepers hold collected tax in trust for the County and must file monthly reports (or quarterly, if approved by the Director) showing room rentals and tax collected, remitting the full amount with each report. The County Council may raise or lower the rate by resolution after a public hearing.
Violations & Fines
Class A violation for noncompliance; 1% monthly interest plus a 5% monthly penalty on unpaid tax, capped at 25% of the tax owed.
Frequently Asked Questions
What is the hotel tax rate in Montgomery County, MD?
Does the tax apply to short-term rentals?
Sources & Official References
Other rules in Montgomery County
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