Airbnb Host Taxes in Connecticut - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Airbnb Host income taxable in Connecticut?

Yes, income earned as an Airbnb host is absolutely taxable, both at the federal and Connecticut state levels. The IRS considers Airbnb hosting a business activity, meaning you’ll need to report your earnings and expenses.

Federal Requirements: You’ll report your Airbnb income and expenses on Schedule C (Profit or Loss From Business), which is filed with your Form 1040. This schedule allows you to deduct all ordinary and necessary business expenses, ultimately determining your net profit or loss. Keep meticulous records of all income and expenses.

Connecticut Specific Rules: Connecticut has a graduated income tax system. This means the tax rate you pay increases as your income increases. Your Airbnb net profit (after Schedule C deductions) will be added to your other income (wages, investments, etc.) and taxed according to the current Connecticut income tax brackets. As of late 2024, these brackets range from 3% to 6.99%. You’ll report your federal Adjusted Gross Income (AGI) on Connecticut Form CT-1040, and then calculate your Connecticut taxable income and tax liability.

Top Tax Write-offs for Airbnb Hosts

Maximizing your deductions is key to minimizing your tax liability. Here are some common write-offs for Connecticut Airbnb hosts:

• Mortgage Interest & Property Taxes: If you own your property, you can deduct the portion of your mortgage interest and property taxes that relate to the time the property is used for Airbnb. This requires calculating the percentage of the year the property was rented.
• Utilities: Expenses like electricity, gas, water, internet, and cable are deductible, again based on the percentage of time the property is rented.
• Cleaning & Maintenance: Costs associated with cleaning services, repairs, and general maintenance (e.g., lawn care, snow removal) are fully deductible.
• Mileage & Vehicle Expenses: When you use your vehicle for Airbnb-related activities (picking up guests, going to the property for maintenance, shopping for supplies), you can deduct either the actual expenses (gas, oil, repairs, insurance, depreciation) or the standard mileage rate. For 2024, the standard mileage rate is approximately 67 cents per mile. Keep a detailed mileage log!
• Airbnb Fees: The fees Airbnb charges you are a deductible business expense.
• Supplies: Items provided for guests like toiletries, linens, and paper products are deductible.

The 15.3% Self-Employment Tax Surprise

Because you're considered self-employed as an Airbnb host, you're responsible for paying both the employer and employee portions of Social Security and Medicare taxes. This is known as Self-Employment Tax.

You’ll calculate this on Schedule SE (Self-Employment Tax). The combined rate is 15.3% (12.4% for Social Security up to the annual wage base, and 2.9% for Medicare). You only pay self-employment tax on profits exceeding $400. The good news is you can deduct one-half of your self-employment tax from your gross income on Form 1040.

Closing Tip for Connecticut Residents

Navigating Airbnb taxes can be complex. As a Connecticut resident, remember to factor in your state’s graduated income tax rates when estimating your tax liability. I strongly recommend keeping detailed records of all income and expenses throughout the year, and consider consulting with a qualified tax professional (like myself!) to ensure you’re taking advantage of all available deductions and complying with all federal and Connecticut tax laws. Proactive tax planning can save you significant money and stress during filing season.