The Tourist Development Tax (also referred to as tourist tax, bed tax or resort tax) Do I report as income for my rental property and is it tax deductible?

[ChristinaS]

In general, you shouldn't claim this income or take this expense. You are collecting this tax on behalf of a government (like sales tax), so its truly neither your income nor your expense. ( I am assuming that you are passing along the fee to your tenants)

It is a lot less correct to claim income/ take the expense because you are just an intermediary, but, as long as the income/expense are a "wash", I don't believe there would be great harm in it. You would have to enter the tax collected as rental income. If you are running the equivalent of a hotel, you may have to file a Schedule C instead of a Schedule E.

Assuming you already know how much taxes you remitted on behalf of tenants, it would be best to do the recommended approach.