Vermont Short-Term Rental Taxes: The Complete 2026 Guide for Property Owners

If you rent your Vermont property on Airbnb, VRBO, or directly to guests, you owe state taxes on that income — and the rules changed significantly in August 2024. A new surcharge added 3% on top of Vermont's existing Meals and Rooms Tax, and a lot of owners haven't caught up.

This guide covers everything: what you owe, who collects it, how to file, and where owners consistently get caught. If you're in a hurry, start with the quick version below. If you want the full picture, read through — the details matter more than most people realize.

The Quick Version (If You're in a Hurry)

Vermont charges a 9% Meals and Rooms Tax on short-term rental income, plus a 3% short-term rental surcharge that took effect August 1, 2024. That's 12% total on gross rental receipts before your management fees or expenses.

Some towns add a 1% local option tax on top of that — Winhall (where Stratton Mountain sits), Manchester, and others. In those towns, you're looking at 13%.

If you only book through Airbnb and Airbnb collects all the money, Airbnb remits the tax for you as a "marketplace facilitator." If you take any direct bookings — even one — you're required to register with the state, collect the tax from guests yourself, and file monthly or quarterly.

That's the short version. Now here's why it gets complicated.

Vermont's Short-Term Rental Tax Breakdown

The 9% Meals and Rooms Tax

Vermont's Meals and Rooms Tax (MRT) has applied to short-term lodging for years. It's 9% of gross rental receipts — meaning the full amount the guest pays for the stay, before you take out anything. If a guest pays $2,000 for a week, you collect and remit $180 in MRT.

This applies to any rental of a room, suite, or entire property for fewer than 30 consecutive nights. Hotels, bed-and-breakfasts, and vacation rentals all fall under the same statute.

The 3% STR Surcharge (New as of August 2024)

Act 127, passed in 2024, added a 3% surcharge specifically on short-term rental properties. It applies to the same gross rental receipts as the MRT and took effect August 1, 2024. Combined with the base MRT, you're now remitting 12% on every dollar of short-term rental income.

This surcharge caught a lot of owners off guard — especially those who set up their tax account years ago and assumed nothing changed. If you haven't updated your remittance calculations since mid-2024, you're likely underpaying.

Local Option Taxes

Vermont allows municipalities to add a 1% local option tax on meals and rooms. Not every town does. But if your property is in a town that has adopted it, you owe an additional 1% on top of the 12% state rate.

In the Stratton area, Winhall has adopted the local option tax — so properties in Winhall owe 13% total. Manchester has also adopted it. You'll want to verify your specific town at the Vermont Department of Taxes website or by calling the municipality directly, since the list can change.

Does Airbnb Collect These Taxes for You?

Sometimes. And this is exactly where owners get into trouble by assuming the answer is always yes.

Airbnb is classified as a "marketplace facilitator" under Vermont law. When you book and receive payment entirely through Airbnb's platform, Airbnb is required to collect Vermont MRT and the STR surcharge from the guest and remit it directly to the state. You don't do anything for those transactions.

VRBO operates similarly — it collects and remits Vermont taxes on bookings processed through its platform.

But here's where it breaks down:

• Direct bookings. If a past guest texts you and pays via Venmo, Zelle, check, or your own booking system, no platform is collecting tax. You are. The full 12% (or 13%) is your responsibility to collect from the guest and remit to Vermont.
• Some VRBO payment configurations. If your VRBO setup routes payment directly to you rather than through the platform, VRBO may not be the one collecting. Check your settings.
• Property management software with direct booking. If you use OwnerRez, Hospitable, or a similar tool with your own payment processor, you're collecting directly and are responsible for tax remittance.
• Corporate or group rentals. If someone books your property for a company retreat and pays by invoice, that's a direct booking. Same rules apply.

The mistake most owners make: they assume that because Airbnb handles their primary bookings, they're fully covered. Then they take a handful of direct bookings over the year — often from repeat guests — and never collect or remit taxes on those. That's unreported income and unpaid taxes.

When Do You Need a Vermont Business Tax Account?

If you take any direct bookings — even one — you're required to register as a Vermont business for tax purposes and obtain a Meals and Rooms Tax account through the myVTax portal at myVTax.vermont.gov.

Registration is free and takes about 20 minutes. You'll need:

• Your Social Security number or Federal Employer ID (EIN)
• Your property address
• An estimate of annual rental income
• Your banking information for remittance

Once registered, you'll receive a Vermont Rooms and Meals Tax account number and filing instructions. Vermont will assign you a filing frequency based on your expected volume.

What happens if you don't register? Vermont has been actively increasing enforcement of short-term rental tax compliance. Penalties for late registration include back taxes owed from the date you started renting, interest at 1% per month, and late filing penalties of up to 5% per month on unpaid tax, capped at 25%. The state can also assess a 25% fraud penalty if there's evidence of intentional non-compliance.

The risk isn't theoretical. Vermont cross-references Airbnb and VRBO listing data, property records, and tax filings. If you're listed on a platform and haven't registered a business tax account, the state knows how to find you.

Local Option Taxes: Does Your Town Add More?

Vermont's local option tax program lets municipalities vote to add a 1% tax on meals, rooms, and alcohol sales within their borders. The revenue goes to the town. Currently, about 40 Vermont municipalities have adopted the local option tax.

For owners in the Stratton Mountain area, here's what you need to know:

• Winhall: Has adopted the local option tax. Total STR tax rate: 13% (9% MRT + 3% surcharge + 1% local).
• Bondville: Located within Winhall, same rate applies.
• Manchester: Has adopted the local option tax. Total rate: 13%.
• Peru and Londonderry: Check current status — adoption can change after town votes.

To verify your town's current status, search for "local option tax" on the Vermont Department of Taxes website (tax.vermont.gov) or call your town clerk's office. This is worth confirming annually — towns can vote to adopt or repeal the local option tax at town meeting.

You collect and remit the local option tax along with the state MRT through the same myVTax account. It's the same filing, same deadline — just a higher rate.

What Counts as a "Short-Term Rental" in Vermont?

Vermont's Meals and Rooms Tax applies to any rental of a furnished room, suite, or residential property for fewer than 30 consecutive nights. If you rent to a tenant for 30 nights or more under a single continuous booking, that's considered a residential rental and is not subject to MRT.

A few details worth knowing:

The 14-Day Rule

If you rent your property for fewer than 14 days per calendar year total, you may be exempt from Vermont MRT. This mirrors the federal "Augusta Rule" that allows homeowners to rent their primary residence for up to 14 days without reporting the income federally. Vermont's exemption applies to the tax obligation, but you should still track those rentals carefully — once you cross 14 days, the exemption disappears entirely and all rental income becomes taxable.

Most active STR owners are well past 14 days, so this exemption rarely applies in practice. But if you rent your cabin a few weeks per year and nothing more, it's worth knowing.

Part-Year vs. Full-Year Rentals

Vermont's MRT applies during any period you're renting short-term, regardless of whether you rent year-round or only during ski season. If you rent from November through April and personally use the property the rest of the year, you owe MRT on all rental income earned during those months. There's no partial-year exemption based on personal use.

Shared Rentals

If you rent individual rooms while living in the property — a spare bedroom during ski weekends, for example — the same rules apply to each room rented. Each night a guest occupies a room you're being paid for is taxable.

How to File and Remit Vermont STR Taxes

All Vermont MRT filing happens through the myVTax portal at myVTax.vermont.gov. Here's how it works in practice:

Filing Frequency

Vermont assigns your filing frequency based on your expected monthly tax liability:

• Monthly filing: If you collect more than $500 in MRT per month (roughly $4,200+ in monthly rental income at the 12% rate), Vermont requires monthly returns due by the 25th of the following month.
• Quarterly filing: If your monthly tax liability is below $500, you file quarterly. Due dates are January 25, April 25, July 25, and October 25.

Most active STR owners in ski markets like Stratton hit the monthly threshold during peak season. Vermont will assign your frequency at registration, but it can be adjusted as your rental volume changes.

Step-by-Step Filing

1. Log in to myVTax.vermont.gov with your account credentials.
2. Navigate to your Meals and Rooms Tax account.
3. Enter gross rental receipts for the period — this is total rental income before any fees or deductions.
4. Apply the applicable tax rate (9% MRT + 3% surcharge + local option if applicable).
5. Subtract any tax collected by marketplace facilitators (Airbnb, VRBO) — these are platform-collected amounts you don't need to remit.
6. Submit the return and pay the balance owed.

You'll need clean records of which bookings came through platforms (and are already remitted) versus direct bookings (which you remit yourself). This is where good bookkeeping becomes essential — muddled records lead to either overpaying or underpaying, and either one costs you.

Penalties for Late Filing

• Late filing penalty: 5% of tax due per month, up to 25% maximum
• Interest: 1% per month on unpaid balances
• Failure to register: Back taxes assessed from first rental date, plus penalties and interest

Vermont doesn't send reminders when your filing is due. It's your responsibility to track the deadlines.

The Compliance Mistakes Vermont STR Owners Make

After working with STR owners throughout southern Vermont, we've seen the same errors come up repeatedly. These aren't exotic edge cases — they're the standard mistakes.

1. Not Registering for Direct Bookings

The most common one. An owner books exclusively through Airbnb for two years, never registers, then starts taking calls from repeat guests who want to skip the platform fee. Now they're taking direct bookings without a tax account, collecting no MRT from guests, and remitting nothing to the state. When Vermont eventually catches up — and they do — the liability is back-dated to the first direct booking.

2. Not Accounting for the August 2024 Surcharge

Owners who set up their remittance process in 2022 or 2023 and haven't revisited it are remitting 9% when they owe 12%. The surcharge has been in effect since August 1, 2024 — roughly 20 months ago at this writing. If you haven't updated your rate, you have a growing underpayment.

3. Multi-Platform Hosting with Incomplete Platform Coverage

Some hosts list on Airbnb, VRBO, and a direct booking site simultaneously. Airbnb and VRBO handle their own tax remittance. The direct booking site handles nothing. If you're not tracking which bookings came from where, you don't know what you still owe.

4. Forgetting Local Option Tax

Owners in Winhall who calculate their rate at 12% instead of 13% are short 1% on every booking. Over a season of strong bookings — say, $80,000 in rental income — that's $800 in underpaid tax. Not ruinous on its own, but it adds up over years and signals sloppy recordkeeping to auditors.

5. Treating Platform Payouts as Gross Income

Airbnb pays you after deducting its service fee — usually 3% for hosts. If you use the platform payout number as your "gross receipts" for MRT purposes, you're understating your taxable income. Vermont's MRT is calculated on what the guest paid, not what Airbnb wired to your account. Use the gross booking amount, then back out the platform-collected taxes separately.

6. Assuming Nothing Changed Since You Set Up Your Account

Vermont STR tax law has changed meaningfully in the last two years. The 2024 surcharge is the biggest example, but local option tax adoptions change at town meeting too. Set a calendar reminder to verify your rate and filing requirements every January.

How We Handle This for Our Owners

Vermont STR tax compliance is one of the things Far & Away does that most property managers in this area simply don't.

We have an in-house CPA advisor — not a contracted bookkeeper, not a platform-generated summary — who handles Vermont Meals and Rooms Tax filing for every property we manage. Every month, your books are reconciled to the bank, your rental income is categorized by booking channel, and your Vermont MRT (including the surcharge and any applicable local option tax) is calculated and remitted correctly.

At year-end, you get a clean package for your accountant: properly categorized Schedule E expenses, gross rental income by channel, taxes remitted on your behalf, and owner draws. It's the kind of documentation that makes your accountant's job straightforward instead of spending two hours trying to reconcile payout statements.

This is genuinely unusual in the southern Vermont STR market. Most management companies hand you an owner statement and call it bookkeeping. We run real books.

If you're managing your own property and the tax piece feels like one more thing to track, that's worth thinking about. The compliance risk is real, and so is the time you spend on it.

Our in-house CPA advisor handles Vermont STR tax compliance for every property we manage — correctly, every month. Get a free property estimate to see if Far & Away is the right fit for your property.