Educational information only, not tax advice. Rules and figures change — confirm your situation with a qualified Wisconsin tax professional before filing.
Wisconsin · USA · Short-term rental taxes
Short-Term Rental Taxes in Wisconsin
STR income in Wisconsin is subject to federal income tax, Wisconsin state income tax, a 5% state sales tax on rentals of 29 nights or fewer, and various local room taxes that vary by municipality.
The 30-Second Answer
- Report all rental income on your federal Schedule E (passive rental) or Schedule C (active/business); Wisconsin mirrors federal treatment and you also file Wisconsin Form 1.
- Wisconsin imposes a 5% state sales tax (plus 0.5% county sales tax in most counties) on STR stays of 29 nights or fewer — platforms like Airbnb collect and remit this automatically in most Wisconsin locations.
- Most municipalities levy a local room tax (typically 2–10%) under Wis. Stat. § 66.0615; unless your platform has a specific agreement with your locality, you are responsible for collecting and remitting it.
- Wisconsin does not conform to federal bonus depreciation, so depreciation schedules may differ between your federal and Wisconsin state returns — keep separate records.
Deductions
Deductions Wisconsin STR Hosts Can Claim
If your rental is treated as a business or rental activity, most ordinary and necessary expenses are deductible against rental income on both your federal and Wisconsin state returns.
Mixed-use properties (personal + rental use) require pro-rating expenses by the number of rental days vs. total days used. Wisconsin follows federal rules on the personal-use day calculation. Note: Wisconsin does not allow federal bonus depreciation; use standard MACRS schedules for your state return.
Filing Calendar
Key Dates & Filing Calendar
Wisconsin individual income tax deadlines generally mirror federal deadlines. Sales and room tax filings have their own schedules.
Wisconsin sales tax on STR stays must be remitted even if a platform collects it on your behalf — confirm your platform's agreement covers your specific municipality before assuming you are fully covered.
Wisconsin Department of Revenue — revenue.wi.gov; IRS Publication 527
Income Tax Treatment
Passive Rental vs. Active STR Business: Which Applies to You?
The US/Wisconsin framework distinguishes between passive rental income (Schedule E) and active business income (Schedule C) based on your level of participation and average guest stay.
Passive Rental (Schedule E)
Standard rental treatment — most part-time hosts
- Income and expenses reported on federal Schedule E; flows to Wisconsin Form 1.
- Losses are 'passive' and can only offset other passive income (unless you qualify as a real estate professional or the $25,000 rental loss allowance applies).
- Depreciation over 27.5 years (residential); Wisconsin does not allow bonus depreciation.
- Not subject to self-employment tax (15.3%).
No income ceiling; passive loss rules may limit deductions
Active STR Business (Schedule C)
Business treatment — hosts providing hotel-like services
- Income and expenses reported on federal Schedule C; flows to Wisconsin Form 1.
- Losses can offset other ordinary income if material participation tests are met.
- Subject to self-employment tax (15.3%) on net profit.
- May qualify for the 20% Qualified Business Income (QBI) deduction under IRC §199A — Wisconsin does not conform to the QBI deduction for state purposes.
No income ceiling; QBI deduction (up to 20%) may apply
Depreciation
Depreciation Rules for Wisconsin STR Owners
Federal MACRS depreciation applies to your rental property and its contents. Wisconsin follows federal depreciation rules with one key exception: Wisconsin does not allow federal bonus depreciation (100% first-year write-off).
| Asset | Typical write-off period | Notes |
|---|---|---|
| Residential rental building | 27.5 years (straight-line) | Land is not depreciable. Only the building value is depreciated. Same for federal and Wisconsin. |
| Appliances & furniture | 5 years (MACRS) | Federal bonus depreciation may allow 100% first-year deduction; Wisconsin does NOT conform — must use standard 5-year schedule on WI return. |
| Carpeting & flooring | 5 years (MACRS) | Classified as personal property if easily removed; otherwise 27.5 years as structural component. |
| Land improvements (driveways, fencing) | 15 years (MACRS) | Wisconsin follows federal 15-year schedule; bonus depreciation not allowed for WI. |
Wisconsin requires an addback of any federal bonus depreciation claimed, then allows a Wisconsin depreciation deduction over the asset's regular MACRS life. This creates a timing difference — keep separate federal and Wisconsin depreciation schedules.
When you sell the property, depreciation previously deducted is subject to federal 'depreciation recapture' taxed at up to 25% (unrecaptured Section 1250 gain). Wisconsin also taxes this gain at ordinary Wisconsin income tax rates (up to 7.65% for 2024).
Wisconsin Room Tax & Sales Tax
Wisconsin Lodging Taxes: State Sales Tax + Local Room Tax
Wisconsin STR hosts face a layered tax structure: a statewide 5% sales tax, a 0.5% county sales tax, and locally-set room taxes that vary significantly by city and county.
Under Wis. Stat. § 66.0615, municipalities and counties may impose a local room tax on short-term rentals. Rates vary widely. The following illustrates a typical combined rate for a Milwaukee-area STR — your actual rate depends on your specific location.
Up to ~15.5% combined (City of Milwaukee example); 5.5% base statewide minimum
Airbnb Wisconsin occupancy tax page (airbnb.com/help/article/2337); Wisconsin DOR revenue.wi.gov/Pages/FAQS/pcs-taxrates.aspx
| Booking type | Who collects & remits | What it means for your books |
|---|---|---|
| State 5% sales tax + 0.5% county tax | Airbnb collects and remits to Wisconsin DOR for all WI reservations (agreement since July 2017). VRBO/Vrbo also collects in Wisconsin. | You do not need to separately remit state sales tax if booking through a marketplace with a DOR agreement — but verify your platform's current agreement. |
| Local room tax (Wis. Stat. § 66.0615) | Platform collects for select cities (e.g., Madison, Milwaukee, Green Bay per Airbnb agreements). For all other municipalities, the HOST is responsible for collecting from guests and remitting to the local taxing authority. | Check your municipality's room tax ordinance. If your city/county is not covered by a platform agreement, you must register, collect, and remit room tax yourself. |
| Premier Resort Area Tax (0.5%–1.25%) | Airbnb collects for designated resort areas (Wisconsin Dells, Lake Delton, Rhinelander, Ephraim, Sister Bay, Stockholm, Eagle River, Bayfield). | If your property is in a Premier Resort Area, this additional tax applies on top of state sales tax. |
Door County, for example, has its own Tourism Zone room tax that hosts must collect and remit directly — Airbnb does NOT collect Door County room tax as of the most recent available information. Always verify with your local municipality.
Platforms
How Airbnb & VRBO Handle Wisconsin Tax Reporting
Major platforms collect Wisconsin state sales tax automatically, but local room tax coverage varies — and federal income reporting depends on your earnings volume.
| Platform | Reports your income | Collects the local lodging tax | Annual earnings summary |
|---|---|---|---|
| Airbnb | Issues 1099-K if >$20,000 gross + >200 transactions (2025 federal threshold); 1099-MISC for bonuses ≥$600 | Collects WI state sales tax (5%) + county tax (0.5%) statewide; local room tax only in select cities (Madison, Milwaukee, Green Bay) | Available in host dashboard by January 31 |
| VRBO / Vrbo | Issues 1099-K at applicable federal/state thresholds | Collects WI state sales tax statewide; local room tax collection varies — check VRBO's tax FAQ for your specific municipality | Available in owner dashboard; check annually |
| Direct bookings | No platform reporting — host must self-report all income | Host is solely responsible for collecting and remitting all applicable state sales tax and local room tax | Host must maintain own records |
Using Multiple Platforms?
If you list on both Airbnb and VRBO (or take direct bookings), aggregate all income across platforms for your federal and Wisconsin state income tax returns. Each platform reports only its own payments — you must combine them. Also ensure local room tax is being collected for every booking channel, not just the ones with platform agreements.
DAC7 / OECD Reporting (Non-US Context)
DAC7 is a European Union directive and does not apply to Wisconsin or US-based hosts. US platforms report to the IRS under domestic 1099 rules.
Airbnb Help Center — airbnb.com/help/article/2337 and airbnb.com/help/article/414; IRS Form 1099-K guidance
Illustrative P&L: Schedule E (Passive Rental)
Example only — a Wisconsin STR earning $30,000/year with typical expenses. Not tax advice.
Record-Keeping
Stay Audit-Ready: What Wisconsin STR Hosts Should Keep
Both the IRS and Wisconsin DOR can audit rental income and lodging tax filings. Good records protect you and maximize your deductions.
| Keep | How long | Why |
|---|---|---|
| Booking records (guest name, dates, nightly rate, platform) | At least 4 years | Substantiates rental income reported and days rented vs. personal use; Wisconsin DOR statute of limitations is generally 4 years. |
| Receipts for all expenses (repairs, cleaning, supplies, insurance, utilities) | At least 4 years (7 years if large losses claimed) | Required to support deductions on Schedule E/C and Wisconsin Form 1. |
| Depreciation schedules (federal and separate Wisconsin schedule) | Life of property + 4 years after sale | Wisconsin does not conform to bonus depreciation — you need separate WI schedules. Depreciation recapture at sale requires full history. |
| Sales tax and room tax filing confirmations | At least 4 years | Proves compliance with Wisconsin DOR and local municipality room tax obligations under Wis. Stat. § 66.0615. |
| Platform 1099-K / 1099-MISC forms | At least 4 years | IRS and Wisconsin DOR match platform-reported income to your return — retain to reconcile any discrepancies. |
If you use your property personally for any days during the year, track those days carefully. Personal use days affect how expenses are allocated between rental and personal use under IRS rules — and Wisconsin follows the same approach.
Estimator
Short-Term Rental Tax Estimator
Plug in your bookings and costs to see your likely taxable position.
Your Numbers
Total short-term-rental income, before costs.
Allowable running costs, mortgage interest, depreciation and platform fees.
Your top income-tax band, as a percentage.
Estimated tax owed
Income tax on your net rental profit at your marginal rate.
Illustrative estimate. A simplified model to orient you — it is not tax advice. Confirm your situation with a qualified local professional.
Sources & notes
This page is for educational purposes only and does not constitute tax, legal, or financial advice. Tax rules change frequently — always verify current rates and requirements with the Wisconsin Department of Revenue (revenue.wi.gov) and a qualified tax professional.
- Wisconsin Department of Revenue — Sales Tax Rates — revenue.wi.gov/Pages/FAQS/pcs-taxrates.aspx — confirms 5% state sales tax and 0.5% county tax on STR stays ≤29 nights.
- Airbnb — Occupancy Tax Collection in Wisconsin — airbnb.com/help/article/2337 — details which Wisconsin taxes Airbnb collects and remits, including state sales tax, county tax, local exposition taxes, and Premier Resort Area taxes.
- Wisconsin DOR — Section 179 and Depreciation Adjustments — revenue.wi.gov/Pages/FAQS/ise-crpsec179.aspx — confirms Wisconsin does not conform to federal bonus depreciation; Section 179 follows federal limits.
- Wisconsin Statute § 66.0615 — Room Tax — docs.legis.wisconsin.gov — authorizes municipalities to impose local room taxes on short-term rentals.
- Door County Tourism Zone — FAQ for Airbnb Hosts — dctzc.org — clarifies that Airbnb collects WI state sales tax but hosts remain responsible for Door County room tax.
- Airbnb Help Center — US Tax Documents — airbnb.com/help/article/414 — explains 1099-K and 1099-MISC issuance thresholds and timing.
- Wisconsin Real Estate Magazine / WRA — Short-Term Rental Law — wra.org/WREM/Nov17/RightToRent/ — background on Wisconsin's 2017 STR law (2017-19 budget) protecting homeowners' right to rent short-term.
- IRS Publication 527 — Residential Rental Property — irs.gov — federal rules on rental income, Schedule E, depreciation, and personal use day calculations applicable to Wisconsin hosts.
Questions
Frequently Asked Questions: Wisconsin STR Taxes
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