Your rental profit sits on top of your paycheck
Tax brackets apply to slices of income, not to all of it. Your other income fills the lower brackets first; rental profit is stacked on top, so it is taxed at the rates of the brackets it lands in. Change your wages or rental profit above and watch the coral slice move up the stack.
So the "tax on Airbnb income" isn't your average rate. For most hosts it's their marginal rate, often 22% or 24%. If the stack above still feels abstract, ahaboo animates income spilling from one band into the next.
How short-term rental income is taxed (US, federal)
The 14-day rule
If you rent out a home you also use for 14 days or fewer in a year, the IRS lets you skip reporting that rental income entirely (Internal Revenue Code Section 280A(g)). Hosts near big one-off events use this every year. Enter 14 or fewer days rented above to see it applied.
Schedule E vs Schedule C
Most hosts report on Schedule E: rental income, minus expenses and depreciation, taxed at ordinary rates, with no self-employment tax. Provide substantial hotel-like services and it becomes a business on Schedule C, adding 15.3% self-employment tax on 92.35% of profit. IRS Publication 527 (Residential Rental Property) and Topic 415 explain the line.
Mixed personal and rental use
If you stay in the home yourself, expenses are split in proportion to rental days vs personal days. If personal use exceeds the greater of 14 days or 10% of rental days, the home counts as a residence and deductible expenses are capped at rental income.
Depreciation
Residential rental buildings (not land) are depreciated over 27.5 years; furniture and appliances over shorter lives (5 or 7 years). Depreciation reduces taxable profit but is "recaptured" at up to 25% when you sell.
Occupancy taxes are separate
States, counties and cities charge lodging or occupancy tax on the guest's stay. Airbnb collects and remits it in many places, but not all; check your jurisdiction.
Questions hosts ask
Do I pay tax on Airbnb income?
In the US, yes, unless you rent the home for 14 days or fewer in the year (the IRS "14-day rule" under Internal Revenue Code Section 280A(g)), in which case the rental income is not reported and rental expenses are not deducted. Otherwise, rental income minus deductible expenses and depreciation is taxable at your ordinary income-tax rates.
Is Airbnb income reported on Schedule E or Schedule C?
Most hosts report on Schedule E and don't pay self-employment tax. If you provide substantial services to guests, like a hotel would (daily cleaning during stays, meals, concierge), the IRS treats it as a business on Schedule C, and the profit also carries 15.3% self-employment tax. IRS Publication 527 covers the details.
What expenses can I deduct?
Ordinary and necessary rental expenses: platform fees, cleaning, supplies, utilities, insurance, repairs, mortgage interest, property tax, software, and depreciation of the building (over 27.5 years for residential rental property) and furnishings. If you also use the home personally, expenses are split by rental days vs personal days.
Will I get a 1099-K from Airbnb?
Airbnb issues Form 1099-K to US hosts who pass the federal reporting threshold, which is $20,000 and 200 transactions for 2026 after the One Big Beautiful Bill Act restored it; some states use lower thresholds. The form shows gross payouts, not profit. You owe tax on net rental income whether or not you receive a form.
What is the "short-term rental loophole"?
If the average guest stay is 7 days or less, the rental generally isn't a "rental activity" under the passive-activity rules. If you also materially participate (for example, 100+ hours and more than anyone else), losses, often driven by accelerated depreciation, may offset other income such as wages. It is complex and audit-sensitive; work with a CPA.