It’s time for the Tax Wizard!

About Vivek Wagle
Tax_wizard

Hello my good people. I am the Airbnb Tax Wizard, and I am appearing to you at this most magical time of year.

What’s that you’re saying? The holidays? No, my fair folk, MUCH more enchanting than that: it’s tax time! This is when I materialize to make sure you’re spellbound – with important tax information!

The first thing I will do is cause an email from Airbnb to appear in your inbox. I do this because I want to make your filing easier.

Next, I want to tell you a tale of three things: income tax, deductions, and the people who can help you during this time.

Income tax

Unless someone has turned you into a newt (which I might be able to help with), you are aware that almost every nation asks you to pay taxes on your income.

I truly hope that you have been blessed with showers of gold thanks to your involvement with Airbnb. As with your other streams of wealth, you may have to give some of this to the tax collector.

Because you are wonderful, I shall wave my wand and automatically allow you to view an estimate of your earnings on your Dashboard, under Transaction History. Presto! 

Ah, but this is just an ESTIMATE, you say? Indeed! However, I have just the spell for you. At the end of the year, I will send you IRS Form 1099, Form 1042, or both – and they will marvelously have the correct numbers. Huzzah!

If you live in the United States, several spellcasters have put together some resources just for you at the IRS website. You can gain sage knowledge on how income derived from properties is treated.

Deductions

A skilled wizard knows about making things disappear. Many countries let you do this via tax deductions.

If you wish to achieve archmage status, you must look into the resources available to you. One page I have my eye on is this IRS deduction topic page.

Help from the masters of tax magic

As a true practitioner of the mystical arts, I am unable to divulge the fay secrets of specialized tax knowledge. To even attempt to do so would risk the wrath of my overseers. Moreover, as different states, counties, cities, and nations in the realm have drastically different rules, you might have to view your castle as a business or even a hotel.

There are those who are uniquely able to serve you in your quest. They are called “tax advisors,” and they are the only characters who will be able to give you specific, credible wisdom.

Your most powerful weapon in your quest for the Tax Grail is your knowledge. May you expand it as greatly as possible.

(The legal mages say: Nothing in this blog post should be construed as tax advice, and you should consult your own advisor.)

May fortune favor you.

13 comments

About Vivek Wagle

Speak Your Mind

*

Share your thoughts

Please keep it civilized and relevant. Comments are moderated, so you may not see yours immediately.

Comments

  1. socaldavids

    I absolutely LOVE Airbnb. I have enjoyed using it around the world in the past few years. As a CPA, I understand how concerned people become when it’s time to prepare their tax returns. I am happy to provide assistance at greatly reduced rates for Airbnb renters. I plan to travel around Europe for 6 weeks next summer, almost exclusively utilizing Airbnb.

  2. Matthew Wie

    I was worried about this but one important rule should be remembered. If you rent out your property for less than 15 days a year, you do NOT have to declare the income.

  3. ALW

    Hi Socaldavids,Are you an accountant? I could do with some tax advice at a reduced rate.Can you contact me?Cheers,Aimee

  4. socaldavids

    ALW, I am not sure how to contact you, so you will have to email me directly at SoCalDavidS@AOL.Com Thanks.

  5. paulette33

    Does that mean that I do not have to claim the first 15 nights of reservations?

  6. Amy B.

    Does anyone know which IRS form we use to declare our rental earnings on a property we also RENT (vs. OWN)? Same form or different one? Thanks! Amy

  7. socaldavids

    Use the same form, Schedule E. You are entitled to deduct the rent you’re paying for each day the unit is being rented out. In addition, of course, to utilities and any other expenses related to the days the unit is rented.

  8. Theodora

    I’m an Airbnb host in Oakland, CA, in a residential neighborhood, of course. . . Am I going to get busted by the City of Oakland and have to pay the transient tax, get a motel/biz license, pay back taxes, etc.? Am the only one worried about this? I’m happy to pay the taxes on the 1099, but don’t want to incur problems. Advice & input is apprecated!

  9. Louise

    I think it is fairly unprofessional for AirBNB to confuse the advice on taxes they are providing on this post with all this wizard B.S. Please keep your "Startup" B.S. to yourself when dealing with important customer topics.

  10. james bond

    Dear tax wizard,I do not want to pay tax on my airbnb, please make it disappear.Kind regards,James

  11. Scott

    Hi socaldavids. I have a few sole proprietorships and would like to include this year’s airbnb into that. Can you email me directly to set this up. I have an accountant for my other business but have made some investments in airbnb rentals this year. Many thanks. Scott. Scott@greencouch.tv

  12. Wainani

    Does anyone know how to File taxes if I don’t own the house that I’m hosting. I’m so confused on how to file? Please help!

  13. socaldavids

    Wainani, I could help you out. Write me at SoCalDavidS@AOL.Com