Hawaii GET & TAT Rental Tax

[TXTortoise]

i assume I got this from Marriott since I just closed on a MOC week.

Is this the day tax the resort collects or something I need to file if renting out unit. I'm not sure yet, if Redweek or Vacation Candy deduct from rent and/or file.

Experiences?

NOTICE REGARDING HAWAII TAXES
The State of Hawaii imposes a General Excise Tax ("GET") and Transient Accommodations Tax ("TAT") on the proceeds of the rental of timeshare interests. If you elect to rent your timeshare interest whether on your own, through Marriott or through another operator, please note that unless arrangements are made for collection and payment of these taxes, you may be liable for the payment of both the GET and TAT due on the rental proceeds. Failure to timely remit these taxes to the Department of Taxation of the State of Hawaii may result in the assessment of the taxes, interest and penalties against you. Any such liability may be in addition to any federal or Hawaii income tax requirements.

 

[DeniseM]

Here's the deal - the State of Hawaii has no idea if you rent your timeshare - unless you tell them. This is just a CYA move from Marriott, so they can "say" that they did their duty by informing you. It's the last you will hear about it.

Marriott does not collect this info, nor report it to the state.

Redweek and Vacation Candy do not get involved in taxes either.

Redweek is just a listing site - when you rent there - you handle the payment.

 

[StevenTing]

They sent this last year as well. It's a CYA as mentioned Denise.

 

[TXTortoise]

Thanks guys.

 

[bizaro86]

Of course, if you are going to make a business out of renting in Hawaii, it is probably a good idea to register and pay taxes.

 

[DeniseM]

Business? I thought the OP just owned one Hawaii timeshare?

 

[NTP66]

Maybe it's a very, very small business?

 

[DeniseM]

Of course, if you are going to make a business out of renting in Hawaii, it is probably a good idea to register and pay taxes.

If you are actually wondering if Redweek or Vacation Candy should be paying this tax, it's not their responsibility. It's the owner of the timeshare who has to pay it - similar to the owner paying income tax on the rental. It would be like asking the rental company to pay your income tax - doesn't work that way.

 

[daviator]

Reviving a very old thread... does anyone have any recent updates on the practical way of dealing with TAT and GET?

If you regularly rent timeshares you own in Hawaii, it's pretty straightforward. You open TAT and GET accounts and you regularly report your earnings and pay the taxes on those. You file nonresident income tax return every year and pay that tax too.

But if you're someone who owns a Hawaii timeshare which they usually use personally, but just once in a while might choose to rent it, it's not so clear. There's a pretty significant administrative burden to setting up accounts which then require regular reporting, even when you have no income to report, along with the requirement to file Hawaii state income tax returns. And from what I've been able to ascertain, once you set up a GET and TAT account, you have to keep filing reports every six months (or more frequently) even if you only rent your timeshare once every few years, or you'll be fined.

I wish one of the timeshare rental platforms could collect and submit all the taxes on behalf of owners. That would make things so much easier and I'd patronize such a site. I really don't want to go through all of this hassle for an occasional rental. What are the chances the state will know? Does using Redweek, Go-Koala, or similar sites increase the likelihood of enforcement?

I'm all for paying the state their due, but they just make it awfully difficult and complicated to do so.

 

[TXTortoise]

FWIW, Vacation Candy now collects and pays GET/TAT out of the gross rental amount. I also expect everyone will be getting 1099s this year, due to the new lower limits, from any vendor that handles rental fees.

If one does this independently setting up the tax accounts is tedious, but reporting and paying is pretty painless. Depending on gross taxes you’ll file anywhere from quarterly to annually. If no rental income, just report zero and move on. Worth it not to have to recreate accounts in the future.