New Jersey Statewide Rule
New Jersey State Occupancy Fee and Sales Tax on Short-Term Rentals
Key Facts
- State Sales Tax
- 6.625% on rental
- State Occupancy Fee
- 5% on rental
- Trigger
- Stays under 90 days
- Collector
- Host or marketplace
Summary
New Jersey applies state sales tax and the State Occupancy Fee to transient short-term rentals statewide, regardless of which municipality the property sits in.
1. a. In addition to any other tax, assessment or use fee authorized by law, there is imposed and shall be paid a hotel and motel occupancy fee of 7% for occupancies on and after August 1, 2003 but before July 1, 2004, and of 5% for occupancies on and after July 1, 2004, upon the rent for every occupancy of a room or rooms in a hotel or transient accommodation subject to taxation pursuant to subsection (d) of section 3 of P.L.1966, c.30 (C:54:32B-3), which every person required to collect tax shall collect from the customer when collecting the rent to which it applies;
Full Breakdown
Under N.J.S.A. 54:32D-1 and the Sales and Use Tax Act, transient accommodations rented for fewer than 90 consecutive days are subject to 6.625% state Sales Tax and a 5% State Occupancy Fee. Marketplace facilitators such as Airbnb and Vrbo must collect and remit these taxes on bookings unless the host is a registered hotel keeper. Counties and shore towns may add municipal occupancy taxes on top, but the underlying state assessment cannot be waived locally.
Violations & Penalties
Failure to register, collect, or remit can trigger Division of Taxation assessments, interest, and penalties up to 25% of unpaid tax, plus possible criminal charges for willful evasion.
Frequently Asked Questions
Do hosts on Airbnb need to register with the state?
Are stays of 90 days or longer taxed?
Sources
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