Room Tax: Short Term Lodging Rentals

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Can I rent out a room or my entire house for a short period of time?

Yes, property owners can rent out a room or their entire house as a short term rental. If you are renting your property as a short term rental, you are responsible for paying a room tax.

What is a room tax?

The room tax is 7% of gross receipts of the renting of a sleeping room at a hotel, motel, inn and residential dwelling lodging, and other short-term lodging rentals such as Airbnb, Home Away and VRBO.

A room tax is assessed by the City of Wauwatosa under state law that authorizes municipalities to collect a room tax. City ordinance authorizes the collection and enforcement of a room tax.

While there is already a formal system in place for hotels and motels to pay their taxes to the City, property owners operating short term rentals must pay their taxes directly to the City.

If the listing does not indicate that a room tax is assessed, the stay is still subject to a room tax. A best practice for hosts is to include the room tax in the listing, so the lodger is aware of the tax.

What does the room tax support?

The room tax revenue funds tourism development, marketing and promotion, which is utilized by the very guests paying the tax. Room tax proceeds are used by the Wauwatosa Tourism Commission to do a lot of fun things in the city, including the installation of six of the new murals on North Avenue, concerts, public art, or other events.

How do I collect a room tax? When is it due?

You collect room tax from the lodger in addition to sales tax, and you pay this directly to the city. The lodging marketplace (such as Airbnb, Home Away, or VRBO) is not responsible for collecting the tax. Room tax payments to the city are due on the 20th day of the subsequent month when room revenue is received. Payments made after that date are subject to a $10.00 per day penalty, plus interest rate of 12% per year in accordance with Wauwatosa Municipal Code sec. 3.16.040. 

Download the Room Tax Form

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