Airbnb Host Taxes in Wisconsin - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Basics for Airbnb Hosts in Wisconsin

From the shores of the Great Lakes to the rolling hills of the Driftless Area, Wisconsin’s short-term rental market is thriving. However, alongside the opportunity to share the beauty of the state with visitors comes the responsibility of accurately reporting rental income for tax purposes. Income earned through platforms like Airbnb is generally taxable at both the federal and Wisconsin state levels. This guide provides an overview of key tax considerations for Airbnb hosts in Wisconsin for the 2025 tax year.

Wisconsin State Tax Rules for Rental Income

As a resident of Wisconsin, a state income tax return is required regardless of the amount of Airbnb income earned. Wisconsin utilizes a graduated income tax system, meaning the tax rate increases as income increases. Airbnb income is generally reported as part of your overall income on Form 1040-ES, and then further detailed on Schedule Z (Wisconsin Adjustments to Federal Income Tax). The primary form for self-employed individuals, including those reporting Airbnb income on Schedule C, is Form 400, Wisconsin Individual Income Tax Return. Wisconsin also requires reporting of any business income, even if it's reported on the federal Schedule E, as it impacts your overall state tax liability. It’s crucial to understand that Wisconsin does not have a separate form specifically for short-term rental income; it’s integrated into the standard individual income tax process. Wisconsin also allows for certain deductions similar to the federal level, such as mortgage interest and property taxes, but these may be subject to state-specific limitations. Furthermore, Wisconsin’s sales tax rules apply to short-term rentals. Generally, rentals of less than 30 days are subject to state and local sales tax, and hosts are responsible for collecting and remitting these taxes. Failure to do so can result in penalties. For detailed information on Wisconsin tax laws and regulations, please visit the Wisconsin Department of Revenue: https://www.revenue.wi.gov/

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. The IRS classifies short-term rentals differently based on the level of service provided.

• Schedule E (Passive Rental Income): Most casual hosts report on Schedule E (Supplemental Income and Loss). This applies if you only provide basic lodging and cleaning between guests. If you are simply renting out a room or property with minimal services, you are likely considered a passive rental and are exempt from the 15.3% self-employment tax.
• Schedule C (Active Business Income): However, if you provide "substantial services" – such as daily cleaning, meals, or concierge services – you report on Schedule C (Profit or Loss from Business) and must pay the 15.3% self-employment tax. This is because the IRS considers this an active business, not a passive rental.

Top Tax Write-offs for Wisconsin Hosts

• Platform Fees: Fees charged by Airbnb, VRBO, and other platforms are fully deductible as business expenses.
• Mortgage Interest & Property Taxes: Deduct the portion of mortgage interest and property taxes that corresponds to the rental space and the period it was rented. If the property is used for both personal and rental purposes, you must allocate these expenses accordingly.
• Repairs, Maintenance & Cleaning: Deduct costs for fixing items in the rental property, professional cleaning services, and cleaning supplies. Routine maintenance is deductible, while improvements that add value to the property are depreciated.
• Depreciation: A powerful but complex deduction that allows you to deduct a portion of the property's cost each year to account for wear and tear. Depreciation calculations can be intricate, and consulting a tax professional is often recommended.