The Complete Montana STR Lodging Tax Guide: Airbnb and VRBO Montana Occupancy Tax Breakdown

Running a successful short-term rental in Montana requires more than just a well-decorated space and stellar customer service. You also need to be tax-compliant. Navigating the tax landscape is crucial to any business. So, today, let's break down exactly what you need to know about lodging and occupancy taxes across the Treasure State.

Montana-Wide Lodging Tax Requirements for Airbnb Hosts

Every short-term rental host in Montana must be aware of two primary state taxes that apply to reservations of 29 days or fewer. The Lodging Facility Use Tax (4%) and the Lodging Sales Tax (4%) are both imposed across the state. These taxes apply to the full amount charged to guests, including the nightly rate, cleaning fees, and any additional guest fees.

Example: A 3-night stay at $150 per night with a $75 cleaning fee.

• Nightly Rate: $150 (3 nights) = $450
• Cleaning Fee: $75
• Total Listing Price: $525
• Lodging Facility Use Tax (4%): $21
• Lodging Sales Tax (4%): $21
• Total Tax Amount: $42
• Guest's Total Payment: $567

County and City-Wide Occupancy Tax Requirements

Beyond the state-wide taxes adding up to 8%, there are specific cities with their own local rates. These local tax rates vary depending on the area and are on top of the state lodging taxes.

Big Sky

Big Sky imposes an additional Resort Tax on top of the state taxes. The Resort Tax is 4% of the total listing price including cleaning fees for stays of 30 nights or shorter.

Example: A 4-night stay at $200 per night with a $100 cleaning fee.

1. Nightly Rate: $200 (4 nights) = $800
2. Cleaning Fee: $100
3. Total Listing Price: $900
4. State Lodging Facility Use Tax (4%): $36
5. State Lodging Sales Tax (4%): $36
6. Big Sky Resort Tax (4%): $36
7. Total Tax Amount: $108
8. Guest's Total Payment: $1,008

Whitefish

Hosts in Whitefish must collect and remit an additional Resort Tax, similar to Big Sky. However, Whitefish hosts should be pleased to know that it's a bit lower, coming in at only 3% of the total listing price.

Example: A 3-night stay at $175 per night with an $85 cleaning fee.

1. Nightly Rate: $175 (3 nights) = $525
2. Cleaning Fee: $85
3. Total Listing Price: $610
4. State Lodging Facility Use Tax (4%): $24.40
5. State Lodging Sales Tax (4%): $24.40
6. Whitefish Resort Tax (3%): $18.30
7. Total Tax Amount: $67.10
8. Guest's Total Payment: $677.10

Wrapping Things Up

By staying informed about Montana's tax requirements, you'll avoid penalties while maximizing your rental's profitability. The STR landscape is constantly evolving, so regularly check for updates to ensure ongoing compliance.

For more information about lodging and occupancy taxes, check out the official Montana Department of Commerce website.