Airbnb income may be reported in two different areas; there are very specific reasons why and each entry has a different tax outcome.
Occasional, short -term rental with no guests services may be deducted as "regular" rental income:
- Federal Taxes
- Wages & Income
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Rental Properties and Royalties - follow the instructions Where do I enter income and expenses from a rental property?
If you dedicate a room in your home solely for the paying clients, never live in that room and provide services such as regular cleaning or maid service, provide coffee or breakfast, you may be considered "running a business". In this case, you would deduct your income and expenses as self-employed income, subject to Social Security and Medicare tax.
- Federal Taxes
- Wages & Income
- Business Items
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Business Income and Expenses (Sch C)- follow the prompts; you may be asked to upgrade to Self-Employed version.