Hotel occupancy tax and cash on cash return

[Ana Mills]

Hi guys,

I’m looking at a property in Austin and working out the cash on cash return so I can make sure it’s a good investment for an AirBnB. 

Since Austin charges 11% hotel occupancy tax, should I include that as part of my expenses when calculating cash on cash return? 

Thank you in advance for all insights.

[Ana Mills]

Quote from @Jordan Moorhead:

Yes and make sure to include the 6% state hotel tax too if you want to do everything above board!

 Thanks for the reply Jordan! 

Does Airbnb already includes and pays the Austin hotel city tax of 11% or do they just include the state tax of 6%?

Thank you a bunch for your help ☺️