15 Airbnb Tax Deductions to Maximize Your Savings

As an Airbnb host, you spend time, effort, and money to create an inviting and hospitable stay for your guests. 

Fortunately, your rental expenses can help you save money during tax season. Although your Airbnb business can generate a surprisingly high tax bill, you can lower your tax liability with Airbnb tax deductions. Your tax savings will help you invest in creating a better experience for your renters. 

Understanding the 14-Day Rule for Short-Term Rental Income

The IRS requires taxpayers to claim Airbnb income and expenses on their tax returns. However, depending on your rental operations, you might not need to report everything. 

Airbnb hosts must understand the exceptions and limitations on vacation rental write-offs.

Personal Use of Rental Property

Airbnb hosts who stay in their own rental property for at least 14 days (or 10% of the total rental days) must track the number of rental vs. personal use days. Review your personal use days annually.

For example, if you rented out your Airbnb for 200 days and stayed at the property for 21 days during the year, you can only deduct expenses related to the 200 rental days. 

Additional rules apply to homeowners renting a room or section of their primary residence. We recommend partnering with professional CPAs for specialized guidance.

Minimal Rental Days

Homeowners who use their own rental property and have fewer than 15 days of vacation rentals during the tax year should not report any rental income or expenses.

We recommend keeping a log of all rental activity and expenses so you can accurately report your Airbnb activity. Tax professionals can help you understand the tax laws and determine your rental business tax deductions.

Operational Expenses for Airbnb Tax Write-Offs

Your Airbnb or Vrbo operational expenses represent the costs you incur when guests stay at your rental property. You can deduct the rental business-related portion of your expenses. Keep receipts and logs of your visitors’ stays to support your Airbnb tax deductions.

1. Repairs and Maintenance

Deductible repairs and maintenance costs include fixing damages and keeping your vacation property in working order. Consider the following examples:

• Updates for wear and tear to your rental

• Fixing damage caused by renters

• Replacing aging parts, such as leaking pipes or old fixtures

• Landscaping and groundskeeping at your rental property

Deductible expenses exclude any costs of personal damage or maintaining your primary residence.

2. Cleaning Services

Airbnb hosts can deduct the cost of providing a spotless vacation rental. Cleaning supplies and fees for professional cleaning services represent rental property tax deductions.

Consult professional CPAs for help determining your Airbnb business tax write-offs.

3. Supplies and Toiletries

Hosts can deduct expenses of restocking guest amenities, such as the following kitchen and bathroom items:

• Water bottles

• Coffee, tea, and other beverages

• Snacks

• Plates and silverware

• Drinking glasses and cups 

• Toilet paper, tissues, and napkins

• Guest towels

• Soaps, lotions, and bathroom toiletries

Taxpayers cannot deduct personal expenses, such as food, drinks, and toiletries consumed in their own homes.

4. Appliances, Furniture, and Decorations

Purchasing decorations and furniture for your vacation rental can lower your Airbnb taxable income. Keep receipts for your rental property purchases, such as the following appliances and furniture:

• Small kitchen appliances, such as coffee makers, microwaves, or toaster ovens

• Furniture purchases and replacements, including mattresses, chairs, and couches

• Decorations

• Indoor and outdoor security systems 

Deductible purchases include ordinary and necessary business expenses under $2,500. The IRS requires taxpayers to depreciate larger real estate purchases. 

5. Utilities

Airbnb hosts can deduct utility costs, including gas, water, and electricity. 

However, the IRS limits deductions to rental-related expenses. To determine your write-off, total the utilities for your vacation property during the tax year. If you meet the 14-day personal use threshold, apply the percentage of rental days to your utility expenses. The result represents your tax deduction for utilities.

6. Subscriptions and Services

Hosts can deduct the cost of internet and amenities for their rental properties. For example, homeowners may offer a guest Netflix account or purchase a vacation home cable package. 

Monthly subscription costs represent rental expenses subject to the rental use limitation. Real estate tax professionals can help you determine the portion of your costs related to your vacation rental business.

Rental Property Management Expenses for Airbnb Tax Write-Offs

Property owners incur numerous costs related to rental property management. Like Airbnb operational costs, taxpayers must limit property management deductions to business-related expenses only.

The following expenses represent tax deductions for Airbnb hosts.

7. Marketing and Advertising

Homeowners can deduct the cost of social media ads and print advertising. Tax write-offs include expenses for advertising and professional marketing services to promote your vacation rental.

8. Professional Services and Management Fees

Small business owners can deduct professional service fees and management company charges, such as the following: 

• Legal and entity formation services

• Accounting, tax advice, and tax filing support

• HOA fees

• Management company charges

• Airbnb host fees

9. Travel Expenses

Airbnb hosts can deduct business-related travel costs. Eligible expenses include a standard mileage deduction or your actual vehicle expenses. 

The IRS imposes specific limitations on vehicle deductions, so we recommend consulting tax professionals to help calculate your travel expense write-off.

10. Insurance Premiums and Mortgage Interest

Your property insurance premiums and mortgage interest payments generate tax deductions. Report your insurance and mortgage interest payments on your rental property to take the rental expense deduction.

11. Non-Income Taxes

Certain small business taxes represent write-offs for Airbnb hosts, including the following: 

• Real estate property taxes

• Occupancy taxes

• State and local sales taxes

• Employment taxes paid on employee wages

Federal and state income taxes cannot generate deductions on your Airbnb tax return.

12. Property Depreciation

Homeowners can deduct depreciation on vacation rental properties. Depreciation expense represents a tax deduction for a percentage of the property’s total cost.

Property owners can take depreciation expense deductions on the following: 

• Rental property and structural attachments

• Significant improvements, such as a remodel or roof replacement

• Appliances and fixtures costing more than $2,500

Depreciation percentages vary by property type. We recommend consulting CPAs for help with complicated calculations.

13. Licenses & Permits

Some jurisdictions require vacation rental hosts to obtain rental permits or licenses. If your local laws require rental property owners to have permits, you can deduct the license application and filing fees. 

14. Home Office Deduction

Business owners can deduct certain costs of maintaining a home office. Eligible taxpayers should use IRS Form 1040, Schedule C, to report the deduction for the business use of their home.

15. Self-Employment Tax Deduction

Most vacation rental hosts are self-employed business owners for income tax purposes. Like independent contractors, Airbnb hosts must pay self-employment taxes. 

However, taxpayers can take an income tax deduction for self-employment taxes. The deduction represents half of the self-employment tax liability. Use IRS Form 1040, Schedule SE, for the calculation.

Nondeductible Airbnb Rental Expenses

Certain Airbnb costs are not tax-deductible rental expenses. Property owners cannot write off the following:

• Federal or state income taxes

• Personal expenses or vacation costs

Additionally, furniture, appliances, or home improvements costing over $2,500 must follow depreciation rules. Tax professionals can support your real estate rental business and help you maximize your Airbnb tax deductions.

1-800Accountant’s Airbnb Bookkeeping & Accounting Playbook

1-800Accountant can help you stay compliant with tax laws and reporting rules. We recommend the following best practices during tax season and year-round.

Understand Your Reporting Requirements

Airbnb hosts should use IRS Form 1040 Schedule E to report rental income and expenses. Refer to IRS guidance and the Schedule E instructions for help completing your tax forms. 

Partner with tax professionals or review real estate accounting resources to learn about your filing requirements. 

Use a Separate Bank Account for Your Rental Business

Open a business bank account to separate your rental income and expenses from your personal finances. Maintaining separate accounts supports timely bookkeeping and a smooth tax season.

Keep Receipts and Track Expenses

Saving your receipts supports your Airbnb tax deductions. In case of an audit, your receipts and expense documentation help validate your write-offs. 

Automate your income and expense tracking to keep your bookkeeping up to date throughout the year. Maintaining accurate records saves valuable time during tax return preparation and quarterly estimate calculations.

Focus on Hospitality – Let Experts Handle Your Accounting

Managing an Airbnb rental can involve tedious paperwork and documentation. Homeowners must comply with tax laws while also making time to communicate with renters, repair properties, and update vacation listings.

Fortunately, 1-800Accountant offers budget-friendly tax advice and return preparation. Professional CPAs support your Airbnb business year-round with dedicated bookkeeping and accounting services.

Schedule a free tax advisory consultation with real estate accounting experts to learn how partnering with 1-800Accountant can benefit your rental business.