Airbnb Host Taxes in Boston, Massachusetts - 2026

Updated for 2026 (Filing 2025 Taxes)

Tax Basics for Airbnb Hosts in Boston, Massachusetts

Navigating the historic streets of Boston as an Airbnb host presents unique opportunities, but also introduces specific tax considerations. Income earned through short-term rentals, even in a vibrant market like Boston, is generally taxable at both the federal and Massachusetts state levels. Understanding these obligations is crucial for compliance and maximizing potential deductions.

Massachusetts State Tax Rules for Rental Income

As a resident of Massachusetts, a state income tax return is required regardless of the amount of Airbnb income earned. Massachusetts operates under a flat income tax rate, currently 5.0% for the 2025 tax year. This means all taxable income is subject to the same rate. Airbnb income is considered part of your overall gross income and must be reported on your Massachusetts income tax return. The primary form used for reporting self-employment or business income, including Airbnb hosting if reported on Schedule C, is Form 1040-EZ, Form 1040-A, or Form 1040, along with Schedule SE (Self-Employment Tax). For rental income reported on Schedule E, the income is still reported on Form 1040. Massachusetts also requires you to pay estimated taxes quarterly if you expect to owe $1,000 or more in state taxes. This is particularly relevant for Airbnb hosts with consistent rental income. Keep meticulous records of all income and expenses, as Massachusetts is diligent in its tax enforcement. Boston-specific considerations, such as potential parking permit costs for guest access or the impact of local events on demand (like Marathon weekend or graduations), should be factored into expense tracking. The Department of Revenue provides comprehensive information and resources for taxpayers. You can find more information at the Massachusetts Department of Revenue website: https://www.mass.gov/orgs/massachusetts-department-of-revenue. Remember to consult the DOR website for the most up-to-date tax rates and regulations.

The Critical Tax Question: Are You a Business or a Rental?

This is the most important tax question for an Airbnb host, as it determines if you owe self-employment tax.

• Schedule E (Passive Rental Income): Most casual hosts report on Schedule E (Passive Income) and are exempt from Self-Employment Tax. This applies if you only provide basic lodging and cleaning between guests. Essentially, if you're simply making a space available for rent, Schedule E is likely appropriate.
• Schedule C (Active Business Income): However, if you provide "substantial services" (daily cleaning, meals, concierge services, providing toiletries beyond basic soap), you report on Schedule C and must pay the 15.3% self-employment tax. This tax covers both Social Security and Medicare. The line between "rental" and "business" can be blurry, so careful consideration is needed.

Top Tax Write-offs for Boston, Massachusetts Hosts

• Platform Fees: Fees from Airbnb, VRBO, etc., are fully deductible. These are considered expenses directly related to generating rental income.
• Mortgage Interest & Property Taxes: Deduct the portion corresponding to the rental space and period. If the property is used both personally and for rental, you must allocate these expenses accordingly.
• Repairs, Maintenance & Cleaning: Deduct costs for fixing items (leaky faucets, broken appliances), professional cleaning, and supplies. Routine maintenance is deductible; major improvements that increase the property's value are depreciated.
• Depreciation: A powerful but complex deduction for wear and tear on your property. It allows you to deduct a portion of the property's cost over its useful life. Often requires a tax professional to calculate correctly.