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Room Occupancy Excise Tax

Does every Massachusetts lodging establishment charge room occupancy excise tax? Is the tax rate always the same?

Overview

In Massachusetts you will be charged a room occupancy excise tax of 5.7% if you stay at one of the following (which charges $15.00 or more per stay) for a period of ninety days or less:

  • Bed and breakfast establishment
  • Hotel
  • Lodging house
  • Motel

A room occupancy operator is any person or business entity operating a:

  • Hotel
  • Motel
  • Lodging house
  • Bed and breakfast establishment
  • Private club operating sleeping accommodations.

In determining whether your property is an establishment subject to these provisions, the following factors are relevant:

  • The establishment provides sleeping accommodations for the lodging of paying guests
  • The typical occupant is a transient or public traveler
  • Generally, the occupancy of the room is less than one week
  • The relationship between operator and occupant is not that of landlord and tenant
  • The operation of the establishment is characterized by centralized management with a manager, who oversees the general operation of the establishment;
  • The establishment provides maid and linen service for its guests or, if meals are served, the establishment will have the necessary utensils, equipment and facilities for cooking, preparing and serving food for its guests.

Please note that a lodging house is defined under Massachusetts General Laws as a house where lodgings are rented to four or more persons unrelated to the operator.

A bed and breakfast establishment is defined as a private owner-occupied house where four or more rooms are rented, a breakfast is included in the rent, and all accommodations are reserved in advance. This kind of establishment is subject to the room occupancy excise. However, private owner-occupied houses where three or fewer rooms are rented, a breakfast is included in the rent and all accommodations are reserved in advance, are defined as a bed and breakfast home and are not subject to the room occupancy excise.

Register with MassTaxConnect to collect room occupancy excise tax.

Local rooms excise and convention center funding charges

In addition, Massachusetts' cities and towns are permitted to charge a local room occupancy excise tax up to 6% on top of the regular 5.7% rooms tax. For more information visit:

In the cities of Boston, Worcester, Cambridge, Springfield, West Springfield, and Chicopee, an additional 2.75% tax is charged for convention center funding. See TIR 05-01 for more information.

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