Paying sales taxes when you rent your Copper Mountain condo

Feb 12, 2010 | No Responses

Sales taxes must be collected when you rent your condo yourself.  Many towns, strapped for cash to provide services for their citizens, are looking for owners who rent their homes and condos but don’t collect or report sales tax.  A recent article in the Denver Post highlighted the problem in Crested Butte and other resort towns, including Breckenridge. 

Under-the-radar renters are a growing problem for Colorado’s resort communities. As ski towns wrestle with withering tax revenue and skyrocketing numbers of people hawking their homes on the Web, the push to find and tax private rentals has become a priority.

“They are essentially hotels, and they need to be paying taxes like hotels,” said Telluride’s town manager, Frank Bell.

Read more: http://www.denverpost.com/commented/ci_14386744?source=commented-#ixzz0fOG3xQmj

I own a condo at Copper Mountain that I rent myself on www.vrbo.com and a couple of other websites.  I applied for and received a sales tax license and I report and pay sales taxes quarterly.  The state gets 5.775% and passes on a portion of it to Summit County, and an additional 3% goes to the Village Association at Copper.  Recently, the Village Association sent a letter to all Copper Mountain homeowners who are within the purview of the Village Association, telling them that they are going to be checking to make sure their tax is collected.  Currently they ask that we write down the amount of our sales for the quarter, together with the number of nights the condo was rented and the amount of the Village Association tax owed, and turn it in with a check.  There is no coupon book or any system of billing.  Many owners have not been aware of the need to collect the tax. 

As it has become easier to rent your condo  or home yourself, the number of vacation rentals  rented through management companies has decreased.  Now instead of a few management companies collecting the majority of the taxes, they have been spread out among many different people so that enforcement and collection is much more difficult.  Copper Mountain, with a relatively small bed base, has many units listed on VRBO.  When you take all of Summit County, with Breckenridge, Keystone, and the towns of Frisco, Silverthorne and Dillon, the numbers must be huge.  If there are uncollected taxes, the towns and the County will eventually come after them, as they see other resort towns like Steamboat, Crested Butte and Telluride being successful in generating more income.  

If you need a sales tax license, you can find the information on it here, at the Department of Revenue website.