Airbnb Host Taxes in Wisconsin - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Airbnb Host income taxable in Wisconsin?

Yes, income earned as an Airbnb host is absolutely taxable, both at the federal and Wisconsin state levels. The IRS considers Airbnb hosting a business activity, and Wisconsin follows suit. You are essentially running a small business, even if it's part-time.

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. Schedule C allows you to deduct all ordinary and necessary business expenses, ultimately determining your net profit or loss. This net profit is then added to your other income when calculating your adjusted gross income (AGI).

Wisconsin Specific Rules: Wisconsin has a graduated income tax system, meaning the tax rate you pay increases as your income increases. The net profit from your Airbnb (reported on your federal Schedule C) will be included in your Wisconsin taxable income. Wisconsin also has its own version of Schedule C, Form ST-1040, Schedule G (Business Income and Expenses), which you'll need to complete and file along with your Wisconsin Form 1040. The Wisconsin tax rates for 2024 (filing in 2025) will be applied to your total taxable income, including your Airbnb profits. Be sure to check the Wisconsin Department of Revenue website for the most up-to-date tax brackets and rates.

Top Tax Write-offs for Airbnb Hosts

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

• Mortgage Interest & Property Taxes: If you own the property, you can deduct the portion of your mortgage interest and property taxes that relate to the time the property is used for rental. If it's a mixed-use property (you live there part of the time), you'll need to allocate these expenses based on the percentage of time the property is rented.
• Utilities: Expenses like electricity, gas, water, internet, and cable are deductible, again allocating the portion used for rental purposes if it's a mixed-use property.
• Cleaning & Maintenance: Costs associated with cleaning the property between guests, as well as repairs and maintenance (e.g., fixing a leaky faucet, painting) are deductible. Major improvements that increase the property's value are generally capitalized and depreciated over time (see below).
• Mileage & Vehicle Expenses: When you drive for Airbnb-related activities (e.g., delivering linens, meeting guests, shopping for supplies), you can deduct either the actual expenses (gas, oil, repairs, etc.) or the standard mileage rate. For 2024, the standard mileage rate is approximately 67 cents per mile (verify the official IRS rate at IRS.gov). Keep a detailed mileage log!
• Supplies & Consumables: Items provided for guests like toiletries, paper towels, coffee, and snacks 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. The combined rate is 15.3% (12.4% for Social Security and 2.9% for Medicare) on earnings over $400.

You'll calculate this on Schedule SE (Self-Employment Tax), which is filed with your Form 1040. The good news is that you can deduct one-half of your self-employment tax from your gross income, which can help reduce your overall tax liability. Don't be alarmed when you see this tax – it's a normal part of being self-employed!

Closing Tip for Wisconsin Residents

Navigating Airbnb taxes can be complex. I strongly recommend keeping meticulous records of all your income and expenses throughout the year. Consider using accounting software designed for self-employed individuals. And, if you're unsure about any aspect of your tax obligations, don't hesitate to consult with a qualified tax professional – like myself! – who is familiar with Wisconsin tax laws. Proper planning and accurate record-keeping will ensure you comply with all regulations and maximize your tax savings.