Phased approach to focus on short-term rentals’ hotel tax collections

Published on March 07, 2022

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The City of Fort Worth is implementing a phased approach to collecting hotel occupancy taxes from short-term rental properties where guests stay overnight for one to 30 days.

The city levies a 9% occupancy tax on hotels. While city code does not include specific language regarding short-term rentals, it broadly defines a hotel to include tourist homes. Short-term rentals currently report and remit their payments on a voluntary basis.

In fiscal year 2021, 20 short-term rentals reported about $330,000 in gross receipts, which generated about $28,000 in hotel occupancy tax to the city. This represents a tiny portion of the $23.75 million in total hotel occupancy taxes collected during the year.

As part of a new phased approach to collecting the tax from short-term rental properties, the city will hire an outside firm to identify these properties operating in Fort Worth. After collecting data, the city intends to have a third-party firm implement a mandatory registration and hotel occupancy tax collection program.

Short-term rentals are not currently allowed in residential zoning districts, but property owners in these districts may apply for a zoning change to allow the short-term rental use.

Going forward, the city may consider policy changes after reviewing the collected data and consulting with neighborhood associations, residents and property owners.

 

 

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