Hotel Stay Tax Exempt After 30 Days Loopholes

This is a discussion on Hotel Stay Tax Exempt After 30 Days Loopholes within the Tax Issues forum, part of the Other Business & Finance Law Issues category; I am residing at a hotel in San Marcos, TX and I always though after 30 consecutive days of staying ...

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Old Oct 24th, 2011, 09:16 PM   #1
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Default Hotel Stay Tax Exempt After 30 Days Loopholes

I am residing at a hotel in San Marcos, TX and I always though after 30 consecutive days of staying at a hotel you become a permanent resident thus tax exempt from the hotel tax. Apparently, the owner of the hotel has been checking me out every 7 days and then re-checking me in. He thinks that because he does this it automatically cancels out my 30-day tax exempt status. Is this true and is this a loophole? The TX law states:

Permanent Residents
(30-Day Rule)

Guests who occupy a hotel room for 30 or more consecutive days are considered permanent residents and are exempt from hotel tax. There can be no interruption of payment during that period.

I would guess the key words and phrase here is consecutive and no interruption of payment. Just because he technically checks me in and out within seconds of each other it does not negate I am staying consecutively and there is obviously no interruption of payment. I know its unethical, but is it also illegal and considered tax fraud? Any advice/help on this would be appreciated.

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Old Oct 24th, 2011, 10:49 PM   #2
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Default re: Hotel Stay Tax Exempt After 30 Days Loopholes

I wish to inform you that 30 days consecutive rule provides that there must not be any interruption. In this regard as you check out and again check in thus there is a break in stay although for a very small time. You may thus avoid tax in future if you now give a notification of your intention to stay but for past 30 days as the stay was not continuous thus ta has to be paid. The notification essentially mentions 30 consecutive days without interruption. At present interruption has come. However you may argue that this has been done by hotel and you have continuously stayed for 30 days without interruption thus you should not be held liable for tax.

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Old Oct 24th, 2011, 11:09 PM   #3
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Default re: Hotel Stay Tax Exempt After 30 Days Loopholes

I would guess it rests on what the state defines as an "interruption". Would the definition depend on what a reasonable person would consider as an interruption? Also, when discussing an "interruption" the statute is referring to payment, that there cannot be an "interruption" in payment and when referring to # of days stayed it uses the word "consecutive". Am I reading the statute correctly? If so, would this change your opinion? Thanks for you response to my question.

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Old Oct 25th, 2011, 05:21 AM   #4
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Default Re: Hotel Stay Tax Exempt After 30 Days Loopholes

Whether the hotel knows your intention for tax exemption. If you want tax exemption you have to inform the hotel in writing with regard to your intention for staying for a 30 consecutive days. You are also required to provide with a tax exemption certificate to the hotel. With regard to the interpretation of statute the word “consecutive” exactly means continuous. So in your case every seven days there is a check out and check in as per the hotel records irrelevant of time span and that means there is no continuity in your stay.
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Old Oct 26th, 2011, 01:51 AM   #5
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Default Re: Hotel Stay Tax Exempt After 30 Days Loopholes

I spoke with the TX Comptrollers Office today and I was informed that the hotel's activity of checking me in and out every 7 days is irrelevant. because it is clear I am staying continuously and checking me in and out does not interrupt my stay. I was informed that if the Hotel is audited they would definitely see the check in and out dates and also see my continuity by the records. Basically I was told what the hotel owner is doing is illegal and the owner could get in trouble for doing what he is doing.
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Old Oct 28th, 2011, 10:14 PM   #6
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Default Re: Hotel Stay Tax Exempt After 30 Days Loopholes

You were wise and prudent to check with the Comptroller's Office. This is a "substance over form" sort of argument. If you are "on paper" supposedly "check out" for one second or whatever and "checked in" immediately thereafter, that is not going to fly. You never left, your luggage never left, you never "signed out", etc. From everything you've said, you would indeed be considered a lodger (resident) rather than a mere guest. In effect, and in reality, for now this hotel is your home or residence.
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Old Jun 12th, 2013, 12:31 PM   #7
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Default Re: Hotel Stay Tax Exempt After 30 Days Loopholes

I am a hotel owner. This is a very easy process for the hotel to get around, and by the way ALL HOTELS in North America take this step to avoid paying your tax fees. Check out after 7 days is mandatory because your reservation is not available on the 8th day is a great way to get around this problem, if you want to complain about not having 30 consecutive days of stay, then go complain somewhere else because the hotel can check you out of your room at any point, or charge you a higher rate (Rack Rate). Guests who usually stay for extended periods usually get a break on the price (25-50% off in some cases) and part of receiving that rate is to accept you will be checked out every 7 days, and that you will be required to pay tax.

You are right, what the hotel does is irrelevant to your life because it is not illegal, it is just a smart business practice. In fact, hotels do not like having guests live at their hotels, we don't get a higher return like leisure or business guests and the fact is that people get annoying after a while, which is evident in this grumpy and cheap person posting a complaint about not paying taxes. PAY YOUR TAXES
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Old Jun 12th, 2013, 01:25 PM   #8
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Default Re: Hotel Stay Tax Exempt After 30 Days Loopholes

While this is an old thread, you are correct. Rental by the week, four times, does not a monthly tenant make.
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Old Jun 29th, 2013, 04:07 AM   #9
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Default Re: Hotel Stay Tax Exempt After 30 Days Loopholes

wow, did you people even read all the posts before rambling your personal views? He spoke with a STATE OFFICIAL who told him the hotels activities were ILLEGAL. I really hope the hotel owner who posted above catches this before he gets audited himself!

QUOTE: "I spoke with the TX Comptrollers Office today...Basically I was told what the hotel owner is doing is illegal and the owner could get in trouble for doing what he is doing."
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Old Sep 19th, 2013, 05:45 PM   #10
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Default Re: Hotel Stay Tax Exempt After 30 Days Loopholes

All of you insisting that the hotel illegally checking out a guest to perpetrate tax fraud are really adorable. Checking in and checking out are irrelevant. Instead of offering your unqualified and incorrect opinion, you may educate yourself and assuage your doubts by contacting the appropriate state agency as the OP did. In lieu of that, your continued silence would be even more helpful than continued misinformation.

As far as the hotel owner, you sir are sorely deficient in the simplest competencies related to being a businessman and likely have mental health issues. These are evidenced by your unreasonable anger toward to customers who make bulk purchases. Your hotel obviously is never at 100% occupancy for the entire month, so to show anger toward a customer who would glady give you revenue for your otherwise perishable inventory is laughable. You always reserve the right to refuse service, however only people with douchy sore loser complexes would accept the business and then complain or hold a grudge. Go get some much needed psychotherapy.
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