Schedule C or Schedule E? This is the one to get right
If you provide "substantial services" to guests — daily cleaning, regular meals, concierge-style services, like running a bed and breakfast — the IRS generally treats it as a business on Schedule C, and self-employment tax applies, which is what this calculator estimates. If it's a more passive rental with just basic services (one cleaning between stays, fresh towels, wifi), it's often reported on Schedule E as rental income, which is not subject to self-employment tax. Many hosts fall into a gray area, and average stay length and service level both matter — this is genuinely one of the trickier calls in gig taxes, so treat the number above as a worst-case (Schedule C) estimate and confirm your category with a tax pro.
Deductions hosts often miss
- Cleaning fees and supplies between every stay.
- Platform fees charged by Airbnb/VRBO.
- A portion of utilities, internet, and insurance proportional to the rented space and time rented.
- Furnishings and depreciation on the property and big-ticket furniture (this gets technical — a CPA pays for itself here).
- Property management software or co-host fees.
- Repairs and maintenance directly tied to the rental.
FAQ
Do I owe self-employment tax just for renting a spare room?
Usually not, if you're providing only basic rental services with no substantial hospitality services — that income often lands on Schedule E instead, without self-employment tax. Confirm with a tax pro since the line depends on specifics.
What if I rent out my place for under 14 days a year?
There's a well-known rule that lets you skip reporting rental income at all if you rent the property for 14 days or fewer in the year and use it yourself the rest of the time — ask a tax pro if this applies to your situation.
Does this calculator handle depreciation on the property?
No — depreciation is property-specific and complex enough that it's outside the scope of a quick estimator. Treat this as a starting point, not a final number.