Understanding the laws, regulations and taxes that govern short term rentals in your location is crucial to starting and running a successful Airbnb. Not having the necessary permits, breaking zoning laws or missing out on an applicable tax can result in hefty fines or even your vacation rental business closed down.
To make sure you are running an Airbnb that is completely above board, read on to find out the rules that govern Airbnbs in Pennsylvania.
Also known as the Keystone State, Pennsylvania is a Middle Atlantic state that offers a variety of experiences. From history, cheesesteak and sports tourism in Philadelphia to the mountain retreat of Poconos; home of the Crayola Experience, the first Christmas tree in the US and other family-friendly attractions in Easton; vineyards, breweries and history in Gettysburg and so much more.
There are no specific laws and regulations governing Airbnbs imposed through the Pennsylvania state government, i.e. apart from taxes. Instead they are specific to the county and city that the Airbnb belongs to.
Here are some of the main Airbnb cities in Pennsylvania and the laws and regulations relevant to them.
The city of Philadelphia recognizes Airbnbs and other short term rentals as residential property rented for fewer than 30 consecutive days at a time. This can be a spare bedroom, a rowhouse or an apartment.
When a primary residence or a room in it is rented out for the short term, they are defined as Limited Lodging and require a Limited Lodging Operator License. Limited lodging operators must live in the residence for at least half of the year.
When you rent a property or unit that is not your primary residence, you need a Rental License.
If you make reservations or collect payment on behalf of a limited lodging operator, you need a Limited Lodging and Hotels Booking Agent License.
Both property owners and tenants engaging in rental arbitrage can apply for these licenses with the exception of the Tenth Council District where only the homeowners are eligible.
When a dwelling unit is rented out for the short term by a renter who calls it their primary residence, living there for over half of the year, it is defined as Visitor Accommodations.
Licenses must be renewed annually.
Airbnb operators are also required to apply for a commercial activity license. You can apply online or make an appointment to visit the Permit and License Center in person. You are also required to obtain a zoning permit.
The city requires safety measures such as smoke alarms on every floor and in every bedroom and carbon monoxide alarms.
Signs announcing lodging facilities are not allowed nor is changing the residence so that it no longer resembles a private residence.
Properties must be certified as being lead-free or lead-safe by the Philadelphia Department of Health and owners must certify they are following all rules on lead safety.
Hosts must notify guests of trash and recycling collection days and disposal rules and ensure there is no excessive noise.
Renters are only allowed to have guests between 8 a.m. and midnight. Guests must also be provided with contact information of the owner, property manager or other designee to handle complaints.
The city also requires property managers to keep records for at least one year showing the home continued to remain a primary residence, the dates the home was rented and the number of guests who stayed.
The Borough of Mount Pocono recognizes a short term rental as all rentals (Airbnbs and otherwise) that are for less than 30 days.
All Airbnbs must be licensed. Each individual short term rental unit requires its own license and licenses are only issued in the name of the owner. Licenses must be renewed annually.
Airbnbs are only allowed in areas designated as permitted by Chapter 215 (zoning codes). Each dwelling unit must be situated in a lot of a minimum area of 0.50 acres.
Each Airbnb is required to have a designated local contact person, be that the owner, property manager or other person, who will be contactable 24/7.
The Borough of Mount Pocono limits the number of overnight occupants allowed in each Airbnb to two people per bedroom plus two people (i.e. a two bedroom short term rental unit can have six people staying overnight). Bedrooms can’t be less than 70 sq ft in area or less than seven feet in any plan dimension and if they hold more than one person, must be at least 100 sq ft.
The borough also regulates notice of license within premises, safety requirements such as smoke detectors, fire extinguishers and sturdy stairs, noise levels and guests’ behavior. A minimum of one parking space per bedroom must be provided.
The city of Easton requires both a residential rental license and a business license to operate an Airbnb within its borders.
Once you register with the city of Easton, an authorized agent of the city will conduct an inspection and then a re-check inspection to ensure all corrections have been completed. Additional re-inspections will incur additional fees.
The residential rental license will only be issued once the inspections have been passed, any overdue taxes and fees to the city have been paid in full and a business license has been obtained. The license must be renewed annually and an inspection conducted once a year by a Code Enforcement Officer.
Violation of city codes can result in penalties or revocation of the license. This includes safety, hygiene and not being contactable by the code enforcement officer.
Each guest must be provided an off-street parking space and no signage advertising or identifying the property as a short term rental can be posted on the property. Short term rentals are also not permitted if they are located within 500 feet of another short term rental property.
The Borough of Gettysburg recognizes short term rentals as those of stays 30 nights or shorter. This includes both owner and proprietor occupied dwellings. Airbnbs where a portion of the host’s personal residence is listed are defined as Homestays and those where the owner lives in a separate dwelling or offsite are defined as Vacation Rentals.
If you want to operate a homestay, you must obtain a Homestay Residency Certification.
Apart from laws and regulations relevant to your location, make sure you check with other rules related to your property, such as contracts, leases, condo board, co-op and HOA rules as well as tenant organization rules.
Airbnbs in Pennsylvania are subject to taxes on the state, county and city levels. Airbnb charges guests most relevant taxes and remits them directly to the relevant authorities. However, it is always best to check to ensure you are not missing out on tax payments. You can find the list of tax collections by Airbnb in Pennsylvania here.
The state of Pennsylvania charges Airbnbs and other short term rentals a Hotel Occupancy Tax of 6% and a Local Sales Tax of 1% of the total listing price including cleaning fees.
Airbnbs located in Easton owe a 4% Hotel Room Rental Tax to Northampton County while those located in Mount Pocono owe Monroe County a Hotel Excise Tax of 3%. Meanwhile, Philadelphia charges a Hotel Tax of 8.5% and Gettysburg, Adam County imposes a Hotel Room Rental Tax of 5%. The state also collects a Local Sales Tax of 1% for Philadelphia County.
The rules that govern Airbnbs in Pennsylvania depend on the individual laws, regulations and taxes imposed by the state, county and city that your Airbnb is located in. Parsing through the different state, county and city codes can be challenging. It can be helpful to seek the advice of a lawyer or consultant to ensure you are aware of the up to date rules applicable to your Airbnb.