Miami-Dade County sues FlipKey, HomeAway over short-term rental tax collection

Miami-Dade County, Florida, has sued online short-term rental platforms FlipKey and HomeAway for their failure to collect lodging taxes from their bookings in the county. The complaints also name FlipKey’s parent company, TripAdvisor, and HomeAway’s parent company, Expedia.

In two separate lawsuits in Miami-Dade Circuit Court, the county alleges the companies are violating a county law that requires third parties that collect payment for short-term rentals to also collect lodging taxes. According to the suit, the companies’ failure to do this has resulted in the loss of potentially millions of dollars in tax revenue.

The county also accuses the companies of refusing to reveal identities of the short-term rental hosts who use their platforms and rejecting tax collection agreements offered by the county. Meanwhile, TripAdvisor and Expedia have both made tax collection agreements with neighboring Broward County.

Airbnb already has an agreement with Florida to collect state and local sales taxes on Florida bookings and pass those revenues on to the state. It has similar deals with several Florida counties, including Miami-Dade County, to collect an additional lodging tax on Airbnb bookings. Airbnb does not collect city-level lodging taxes in Florida, except in Surfside.

Short-term rental hosts in Miami-Dade County who use other rental platforms, including FlipKey, HomeAway, and VRBO, are responsible for collecting all lodging taxes, including state and local sales tax and applicable county and city lodging taxes, from guests.

Hosts need to be aware that they’re responsible for registering with tax authorities and filing regular lodging tax returns, even if their rental platform is collecting and remitting taxes on their behalf. Platforms generally submit collected lodging taxes in one lump sum to tax authorities without identifying individual hosts, so it’s the responsibility of hosts to report how much tax was collected and remitted on their behalf.

Automated solutions such as MyLodgeTax can help short-term rental hosts navigate lodging tax compliance in an environment where short-term rentals are coming under increased scrutiny.

In Miami Beach, for example, short-term rental operators are charged a fine of $20,000 on the first violation of the short-term rental code. Each subsequent fine increases by another $20,000 and can go as high as $100,000.

Miami Beach also recently passed a law that requires online short-term rental platforms to include business license information on each rental listing. All Florida short-term rental hosts are required to get a state-issued vacation rental license, as well as a state tax certificate. In Miami-Dade County, hosts are also required to get a county-issued Certificate of Use.

For more on Florida lodging tax, see our state vacation rental tax guide.