New Vacation Rental Tax Poses a Threat to Jersey Shore Tourism

For decades now, Jersey Shore cities filled up every summer with tourists. Populations swell to twice their size or more as people choose our lovely seaside towns like Margate, Longport, and Ventnor for their vacation destination. While a few may rent by the week, more often, families rent by the month or season (three months at a time) making the Jersey Shore home for the summer months. Now, a new vacation rental tax in New Jersey poses a threat to Jersey Shore tourism.

Earlier this year, the NJ legislature created a new vacation rental tax for Jersey Shore homeowners: the transient accommodations tax. In effect, anyone renting a property must pay an additional 12-14% in taxes.

What is the New Vacation Rental Tax?

Search Jersey Shore homes for saleIn July 2018, the New Jersey legislature instated several state and local taxes geared toward rental properties. The new vacation rental tax (Transient Accommodations Tax) applies to all bookings done through an online company (such as Airbnb or VRBO) or when working directly with the homeowner. These taxes rack up an additional 12-14% fee on top of all the other charges a renter pays. Initially, the new vacation rental tax was created to lower the competition between hotels and places like Airbnb. Unfortunately, individual homeowners were thrown into the mix as well. In turn, the homeowners pass this tax on to the renter.

New Jersey Shore Rentals Coalition

In an effort to battle to repeal the new vacation rental tax at the shore, the New Jersey Shore Rentals Coalition was created. This group of vacation homeowners hopes to convince the legislature that the new tax could hurt local tourism. When tourists pay more to rent a property, that means they spend less in the community as a whole or, worse yet, look to other destinations to spend their summer vacations. In fact, homeowners already experienced a drop in interest from renters for next year compared to the previous year.

How to Avoid the New Vacation Rental Tax (for Now)

Currently, the transient accommodations tax applies only to bookings done through online travel companies. However, any vacation rental handled with a licensed real estate agent won’t rack up these additional taxes. For the foreseeable future, book your next vacation rental through a real estate agent. If you own a Jersey Shore home, consider hiring a NJ licensed real estate agent to handle your rentals. It’ll save you time, money, and hassle.

Anyone interested in helping the New Jersey Shore Rentals Coalition fill their legal defense fund should visit their Go Fund Me page. As of the writing of this post, they’ve raised $8200 of their $32,000 goal. All money raised helps them in their fight against the tax for Jersey Shore vacation rentals.

Sherri Lilienfeld, Apex Prime Realty, Your Source for Jersey Shore Real Estate

Leave a Comment

Your email address will not be published. Required fields are marked *