Sussex County, DE Short-Term Rentals: Permit Requirements (2026)

Sussex County's STR regulatory framework is split between the State of Delaware (lodging tax + business licensing for intermediaries), Sussex County (3% local lodging tax + zoning for unincorporated areas), and the individual incorporated municipalities (the rental license + local tax + occupancy rules where the property sits inside town limits).

(1) DELAWARE STATE SHORT-TERM RENTAL LODGING TAX. Under HS 2 for HB 168 with HA 1 (signed September 30, 2024) and codified at 30 Del. C. Ch. 62, the State imposes a 4.5% short-term rental lodging tax on the rent for every occupancy of a short-term rental in Delaware. The tax applies to agreements entered into on or after January 1, 2025. A 'short-term rental' is defined as a residential dwelling unit (house, apartment, condominium, houseboat, or similar) rented to a transient guest for no more than 31 consecutive nights. The tax is imposed on rent (monetary consideration for occupancy) and excludes municipal taxes, linen fees, cleaning charges, insurance, security deposits, and month-to-month holdover leases. An 'accommodations intermediary' (Airbnb, Vrbo, real estate broker of record, timeshare plan, or any other person facilitating or arranging an STR booking) is responsible for collecting and remitting the tax. Property owners who book exclusively through a registered accommodations intermediary do not need a separate Delaware business license; owners who self-rent (direct booking) must obtain an Accommodations Intermediary business license ($25) at onestop.delaware.gov and remit the tax themselves. Returns and payments are due on the 15th day of the month following the month of collection via tax.delaware.gov. Members of an HOA/condo association who rent only through a third-party platform are exempt from the State business license requirement.

(2) SUSSEX COUNTY 3% LOCAL LODGING TAX. Under 9 Del. C. § 8112 the State authorized Sussex County to impose by ordinance a local lodging tax of up to 3% on rent for any room in a hotel, motel, tourist home, or short-term rental located in the unincorporated areas of the county. Sussex County exercised this authority in Chapter 103, Article VI of the Sussex County Code (originally adopted 2020 for hotels/motels/tourist homes, generating approximately $3.4 million through 2024) and amended via Ordinance 2687 (introduced October 29, 2024) to extend the 3% rate to short-term rentals in unincorporated Sussex County aligned with the state STR lodging tax. The Sussex County 3% tax is collected by the State of Delaware on the County's behalf via the same MyDORWAY/tax.delaware.gov portal and is remitted by the 15th of the month following collection. Late payments incur a 1% per month penalty. Tax proceeds are restricted by 9 Del. C. § 8112 to capital and operating costs of beach nourishment, waterway dredging, economic development, tourism programs, recreational activities, and water quality and flood control projects within Sussex County.

(3) MUNICIPAL RENTAL LICENSING (incorporated towns inside Sussex County). The State and County frameworks above apply only to the lodging tax. The actual rental license, occupancy limit, life-safety inspection, and local contact rules are set by each incorporated municipality where the rental is physically located:

REHOBOTH BEACH (Chapter 210 Residential Rentals): annual Residential Rental License ($150) issued by the Building & Licensing Department at 229 Rehoboth Avenue (302-227-6181 ext. 222, buildingandlicensing@rehobothbeachde.gov). Maximum overnight occupancy is two persons per bedroom plus an additional two persons (e.g., a 3-BR rental allows 8 guests; children age 6 and under are not counted). Application requires proof of ownership, current property tax status, designation of a 24/7 local contact, GFCI in bathrooms/kitchens, smoke detectors, address markings, code-compliant egress windows, and posted occupancy limits and license number. Annual self-inspection required before renewal. Rehoboth Beach also imposes a 7% local lodging tax on gross rental receipts in addition to the State 4.5%.

BETHANY BEACH: annual Rental License ($100) for any property rented at any time during the year. Bethany imposes a 7% local rental tax on gross rental income, due on November 1 and June 1 each year, in addition to the State 4.5%. Combined State + Bethany Beach tax = 11.5%.

LEWES (Rental Licensing Program effective January 1, 2023): $100 annual Short-Term Rental License from the City of Lewes. License year is calendar year (January 1 through December 31); fees due no later than February 1. Owners must confirm compliance with building, health, fire, and safety standards; identify a 24/7 local contact who can physically respond within 2 hours; establish maximum occupancy limits; and inform tenants of city regulations and evacuation routes.

DEWEY BEACH (Ordinance 831, adopted February 16, 2024): annual Residential Rental License of $188 per unit for up to 2 bedrooms, plus $15 for each additional bedroom. Dewey Beach imposes a 3% local accommodations tax on short-term rentals; the property owner is responsible for the tax but may designate an agent to collect and remit. Properties with a lease on file at Town Hall are exempt from the accommodations tax.

(4) UNINCORPORATED SUSSEX COUNTY ZONING. The Sussex County zoning code (Chapter 115) does not currently use the term 'short-term rental' as a stand-alone use. The closest defined use is 'tourist home' (a dwelling with not more than six rental rooms for guests, no in-room cooking facilities), regulated as a permitted or conditional use depending on district. Single-family dwellings used as STRs in unincorporated Sussex County are generally treated as residential uses subject to the underlying zoning district's standards (parking, setbacks, occupancy). Operators in unincorporated areas should contact Sussex County Planning & Zoning at 302-855-7878 before renting to confirm the parcel's zoning permits the use and that no recorded HOA covenant prohibits short-term rentals.

(5) FIRE/LIFE-SAFETY. Delaware does not impose a single statewide STR safety inspection, but the State Fire Marshal's Office (Delaware State Fire Prevention Regulations) requires functional smoke alarms, carbon monoxide alarms (where fuel-fired appliances are present), and reasonable means of egress in residential rentals. Municipalities (Rehoboth Beach, Lewes) require these be confirmed via annual self-inspection.

(6) FEDERAL/INSURANCE. Sussex County contains extensive FEMA Special Flood Hazard Areas (Rehoboth, Lewes, Bethany, Fenwick, Inland Bays). Mortgaged STRs in SFHAs require federal flood insurance under 42 U.S.C. § 4012a; lender enforcement is independent of the County's STR regime.