Revenue Releases Technical Information Memorandum (TIM) on New Short-term Rental Lodging Tax

Statewide, DE (November 20, 2024) – Division of Revenue released technical guidance on the new short-term rental lodging tax on November 15, 2024. The Technical Information Memorandum (TIM) provides uniform definitions, describes the responsibilities of the accommodations intermediaries, and lays out the interest and penalties related to the failure to file tax returns, failure to provide a complete return with all required information, or to remit payment of the tax.

Pursuant to House Substitute 2 for House Bill 168 as amended by House Amendment No. 1 that was signed into law on September 30, 2024, Delaware has imposed a short-term rental lodging tax at the rate of 4.5% of the rent upon every occupancy of a short-term rental within this State. This new tax goes into effect for short-term rental agreements entered into on or after January 1, 2025. Effective immediately, accommodations intermediaries are required to obtain an annual Delaware accommodations intermediary business license via onestop.delaware.gov prior to conducting accommodations intermediary services. If a property owner uses a third-party rental listing company (e.g., Airbnb, Vrbo, Booking.com, Expedia, Tripadvisor, etc., or a local or similar a rental listing company) to book the short-term rental, only the third-party rental listing company is required to obtain the accommodations intermediary business license and collect and remit the tax.

For more information, please see the Division of Revenue’s Frequently Asked Questions. If you have questions about the new short-term rental lodging tax, please contact John McKinny at (302) 577-8267 or john.mckinny@delaware.gov.

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