Washington, District of Columbia Short-Term Rental Regulation: A Guide For Airbnb Hosts

What are Short-Term Rental (Airbnb, VRBO) Regulations in Washington, District of Columbia?

Washington, D.C.'s short-term rental landscape underwent significant changes with the passage of the Short-Term Rental Regulation Act of 2018, which finally went into effect in early 2022 after several years of delays. As a real estate expert specializing in short-term rentals, I've seen firsthand how these regulations have reshaped the market in our nation's capital. Whether you're considering purchasing an investment property or looking to generate extra income from your primary residence, understanding D.C.'s short-term rental rules is essential for success in this space.

Starting a Short-Term Rental Business in Washington, District of Columbia

The District of Columbia allows short-term rentals to operate in any neighborhood or zone, provided hosts obtain the proper licensing and follow specific regulations. If you're considering entering this market, here's what you need to know:

License Requirements

All short-term rental operators in D.C. must obtain a valid Basic Business License with either a "Short-Term Rental" endorsement or a "Short-Term Rental: Vacation Rental" endorsement. The Department of Consumer and Regulatory Affairs (DCRA) began accepting applications for these licenses in January 2022, with enforcement starting in April 2022.

The licensing process requires:

• Proof of primary residence (eligibility for homestead deduction)
• Proof of liability insurance with minimum coverage of $250,000
• Compliance with safety requirements, including smoke detectors
• Registration with D.C. Office of Tax and Revenue for tax collection

Primary Residence Requirement

One of the most significant restrictions is that short-term rentals can only operate in your primary residence. This means:

1. You cannot purchase multiple properties specifically for short-term rental purposes
2. The property must be your actual residence where you live
3. Accessory dwelling units, including English basements, are considered part of your primary residence

Two Types of Short-Term Rentals

D.C. regulations distinguish between two types of short-term rental arrangements:

1. Short-Term Rental (Host Present): When you remain on the property during the guest's stay (like renting out a bedroom), there's no limit on the number of nights per year you can rent. Each individual rental is limited to 30 or fewer continuous nights.
2. Vacation Rental (Host Not Present): When you're not present and guests have exclusive use of your entire primary residence, you're limited to 90 nights per calendar year. Each rental is still limited to 30 or fewer continuous nights.

For those looking to succeed in this space, careful compliance with regulations, strategic pricing, and exceptional guest experiences are key. The 90-day cap on vacation rentals makes it particularly important to maximize revenue during available nights, perhaps by focusing on high-demand periods like cherry blossom season or when major events are happening in the District.

Despite the regulatory hurdles, short-term rentals remain a viable option for generating income from your primary residence in D.C., especially if you're comfortable with the hosted rental model, which has no annual cap on the number of nights you can rent.

Short-Term Rental Licensing Requirement in Washington, DC

The District of Columbia has established clear licensing requirements for short-term rental operators through the Short-Term Rental Regulation Act of 2018, which went into effect in January 2022. Understanding these requirements is crucial for anyone looking to operate a legal short-term rental in the nation's capital.

License Types Available

Washington DC offers two distinct license types for short-term rental operators:

1. Short-Term Rental License: This allows hosts to offer accommodations at their primary residence while they remain present on the property (for example, renting out a bedroom). With this license, there's no limit on the number of stays allowed during a calendar year, provided the host is present. However, each individual rental is limited to 30 or fewer continuous nights.
2. Vacation Rental License: This permits hosts to offer their entire primary residence without being present during the guest's stay. Vacation rentals cannot exceed a cumulative total of 90 nights in any calendar year, and each individual rental is still limited to 30 or fewer continuous nights.

Eligibility Requirements

To qualify for either license type, applicants must meet several criteria:

1. The property must be the host's primary residence
2. Only natural persons (individuals) are eligible; business entities like LLCs or corporations cannot apply
3. Tenants are not permitted to operate short-term rentals in their rental units
4. The host must live in the primary portion of the property (an owner cannot live in the basement and operate the remainder as a short-term rental)

Documentation Required

When applying for a short-term rental license in DC, hosts must provide:

1. Proof of primary residence (eligibility for homestead deduction)
2. Proof of liability insurance with minimum coverage of $250,000
3. A Certificate of Clean Hands in the property owner's name issued by the DC Office of Tax and Revenue within the past 30 days
4. Self-attestation that the property complies with DC Housing Code and Property Maintenance Code
5. For properties within a condominium, cooperative, or homeowner association, proof that the governing body permits short-term rentals
6. Description of the short-term rentals to be provided on the property

Application Process

The licensing process involves several steps:

1. Create an Access DC single sign-on account (if you don't already have one)
2. Visit the District of Columbia Short-Term Rental Licensing Platform online
3. Register with basic contact information
4. Link your account with the address where you'll conduct short-term rentals
5. Complete the full license application and upload required documentation
6. Pay the licensing fees

Licensing Costs

The total cost for either type of short-term rental license is $104.50 for a two-year license period. This breaks down as:

1. $70.00 processing fee
2. $25.00 endorsement fee
3. $10.50 technology fee (10% of the total)

This fee structure makes DC's short-term rental licensing relatively affordable compared to other major cities. For instance, San Francisco charges $450 for a two-year license.

Where to Submit Applications

All short-term rental license applications must be submitted online through the District of Columbia Short-Term Rental Licensing Application portal at https://dcra.munirevs.com/. No paper applications are accepted, and the entire process is handled digitally.

Processing Time

While the DC Department of Licensing and Consumer Protection doesn't specify an exact timeframe for processing applications, hosts should allow several weeks for review and approval. When the regulations first went into effect, a 90-day grace period was provided to allow existing operators time to come into compliance.

Penalties for Non-Compliance

Operating without a license or violating short-term rental regulations can result in significant penalties:

1. First violation: $500 fine
2. Second violation: $2,000 fine
3. Third violation: $6,000 fine and revocation of the short-term rental license

Additionally, booking services (platforms like Airbnb or VRBO) that facilitate illegal rentals can face penalties of $1,000 for each booking transaction made in violation of the regulations.

Operational Requirements

Once licensed, hosts must:

• Include their license number in all listings and advertisements
• Maintain the required liability insurance coverage
• Ensure continued compliance with housing and safety codes
• For vacation rentals, track and limit rentals to no more than 90 nights per calendar year
• Collect and remit applicable taxes (though platforms like Airbnb typically handle this)

Renewal Process

Short-term rental licenses are valid for two years. Hosts must renew their licenses before expiration by submitting an updated application with current documentation and paying the renewal fee.

Verification and Enforcement

The DLCP maintains an online database called SCOUT where anyone can verify if a short-term rental is properly licensed. Suspected violations can be reported to the District of Columbia Short-Term Rental Hotline at (202) 221-8550.

The District's comprehensive licensing requirements aim to balance the economic opportunities of home-sharing with the need to preserve housing for long-term residents. By following these regulations carefully, hosts can operate legally and avoid potentially costly penalties while contributing to DC's vibrant tourism economy.

Required Documents for Washington, DC Short-Term Rentals

Securing a short-term rental license in Washington, DC requires thorough documentation to ensure compliance with the District's regulations. Each document serves a specific purpose in the regulatory framework established by the Short-Term Rental Regulation Act of 2018. Here's a comprehensive breakdown of what you'll need to gather before applying:

Certificate of Clean Hands
This document verifies that you don't owe more than $100 to the District for fees, fines, taxes, or penalties, and that you've filed all required tax returns. The certificate must be:

• Issued within 30 days prior to your application
• In the property owner's name (not a business entity)
• Obtained from the DC Office of Tax and Revenue

You can apply for this certificate through the MyTax.DC.gov portal. The District's "Clean Hands" mandate prevents individuals with outstanding debts from receiving city services, including licenses and permits.

Proof of Liability Insurance
Short-term rental operators must maintain liability coverage to protect against potential guest injuries or property damage. Requirements include:

• Minimum coverage of $250,000
• Can be obtained through a rental platform (like Airbnb or VRBO) or directly from an insurance company
• Must cover the specific property being rented

This requirement ensures that both hosts and guests have financial protection in case of accidents or damages during a stay.

Short-Term/Vacation Rental Attestation Form
If your property is part of a homeowners association, condominium, or cooperative, you must complete this form to confirm that short-term rentals are permitted. The attestation verifies that:

• The bylaws, house rules, or other governing documents allow short-term and/or vacation rentals
• The governing board or association does not prohibit owners from operating short-term rentals
• You've received written permission from the association to operate a short-term rental at your address

This requirement prevents hosts from operating rentals in buildings or communities where they're prohibited by governing documents.

Proof of Primary Residence
Since DC regulations only permit short-term rentals in the host's primary residence, you must provide documentation proving you actually live in the property. Acceptable forms include:

• Homestead deduction eligibility documentation
• Driver's license or identification card with the property address
• Utility bills in your name at the property address

This requirement is designed to prevent the conversion of long-term housing into dedicated short-term rental properties.

Property Safety Documentation
While not typically submitted with your application, you must attest that your property meets safety requirements, including:

• Unobstructed egress (clear exit paths)
• Working smoke detectors
• Carbon monoxide detectors
• A portable fire extinguisher

These safety features are essential for protecting guests during their stay and may be subject to inspection.

Contact Information for Emergency Access
You must provide a phone number where you or your representative can be reached 24 hours a day in case of emergencies. This ensures that there's always someone available to address urgent issues that may arise during a guest's stay.

Payment Method
A credit or debit card is required to pay the licensing fees at the time of application. The total fee for either type of short-term rental license is $104.50 for the two-year license period.

All these documents must be submitted through the District of Columbia Short-Term Rental Licensing Application portal. The comprehensive documentation requirements reflect DC's commitment to ensuring that short-term rentals are operated responsibly, safely, and in compliance with local regulations. By gathering these materials in advance, you can streamline your application process and avoid delays in obtaining your license.

Washington, DC Short-Term Rental Taxes

Operating a short-term rental in Washington, DC comes with specific tax obligations that hosts must understand and comply with. The District has established clear tax requirements for short-term rental operators to ensure they contribute appropriately to the local economy and tourism infrastructure.

Sales Tax on Transient Accommodations

The most significant tax obligation for short-term rental hosts in DC is the sales tax on transient accommodations. As of April 1, 2023, this tax rate stands at 15.95% of the listing price, which includes any cleaning fees and guest fees for reservations of 90 nights or shorter. This represents an increase from the previous rate of 14.95%, and this higher rate will remain in effect through March 30, 2027.

This tax applies to the gross receipts from any room, lodging, or accommodation furnished to transient guests by hotels, inns, tourist camps, tourist cabins, or any other place regularly providing accommodations in the District. The increase was implemented under the Tourism Recovery Tax Emergency Amendment Act of 2022.

It's worth noting that for bookings made before April 1, 2023, but not fully paid by that date, the 15.95% rate applies to payments received on or after April 1, 2023. However, for bookings both made and paid in full before April 1, 2023, the rate remains 14.95%, even if the accommodation is furnished after that date.

Tax Collection Responsibility

While platforms like Airbnb and VRBO typically collect and remit these taxes on behalf of their hosts, all short-term rental operators in DC are still required to:

• Register with the DC Office of Tax and Revenue (OTR)
• File regular sales tax returns, even if the platforms are collecting the taxes
• Maintain accurate records of all transactions

This registration requirement ensures that the District can properly track and account for all short-term rental activity within its jurisdiction.

Business Income Tax Considerations

In the District of Columbia, rental income is considered business income for tax purposes. This means that short-term rental hosts must:

• Register their rental activity as a business
• Report rental income on their tax returns
• Pay applicable business income taxes

For non-resident property owners who rent out homes in DC, there's a specific threshold: if gross rents for a property located in the District exceed $12,000 per year, you are considered a business and must file an entity-level return to report business income and/or losses, even if you're not domiciled in the District.

Tax Deductions and Write-offs for Short-Term Rentals

Short-term rental hosts in DC can take advantage of several tax deductions to reduce their overall tax burden:

• Mortgage Interest Deduction: One of the most significant tax benefits is the ability to deduct mortgage interest paid on the rental property. This deduction applies to interest on mortgages as well as other loans taken out to improve the property.
• Depreciation: The IRS allows landlords to deduct the cost of the property over a specific period, typically 27.5 years for residential properties. This accounts for wear and tear on the property over time, providing a substantial tax break.
• Property Tax Deduction: Property taxes paid on investment properties can be deducted, helping offset the costs of owning and maintaining a rental property.
• Repairs and Maintenance: Costs for keeping your property in good working order are fully deductible in the year they are incurred. This includes routine maintenance, fixing broken items, and general upkeep.
• Platform Fees and Commissions: Fees charged by rental platforms like Airbnb or VRBO are tax-deductible, as are commissions paid to property managers or real estate professionals for leasing services.
• Cleaning and Supplies: The frequent turnover in short-term rentals necessitates regular cleaning and restocking of essentials. These expenses are deductible and can add up significantly over time.
• Travel and Transportation: If you travel to manage your rental property, these expenses may be deductible if they're directly related to the operation of your rental business.
• The 14-Day Rule: A notable tax benefit is the "14-day rule," which allows property owners to rent out their property for up to 14 days per year without reporting the income to the IRS. However, if you take advantage of this rule, you cannot deduct rental expenses.

Understanding and properly managing these tax obligations and opportunities is essential for running a profitable and compliant short-term rental business in Washington, DC. Consulting with a tax professional who specializes in rental properties can help ensure you're maximizing your deductions while meeting all your tax responsibilities.

District of Columbia Wide Short-Term Rental Rules

The District of Columbia's short-term rental landscape is governed by the Short-Term Rental Regulation Act of 2018, which finally went into effect in January 2022 after several years of delay. This comprehensive legislation establishes uniform regulations across all neighborhoods and zones within DC, creating a standardized framework for anyone looking to operate a short-term rental in the nation's capital.

Primary Residence Requirement

One of the most fundamental rules in DC's short-term rental regulations is that the property must be the host's primary residence. This means:

1. You can only operate short-term rentals in the home where you actually live
2. Investment properties purchased specifically for short-term rental purposes are not permitted
3. The law defines a primary residence as a property for which the owner is eligible for the homestead deduction

This requirement was designed to prevent the conversion of long-term housing stock into dedicated short-term rental properties, addressing concerns about housing affordability in the District.

License Types and Limitations

The District offers two distinct license types, each with specific restrictions:

Short-Term Rental License (Host Present): When the host remains on the property during the guest's stay, there's no limit to the number of nights per year the property can be rented. However, each individual rental is limited to 30 or fewer consecutive nights.

Vacation Rental License (Host Not Present): When renting the entire property without the host present, rentals are capped at 90 cumulative nights per calendar year. Each individual booking is still limited to 30 or fewer consecutive nights.

Insurance Requirements

All short-term rental operators in DC must maintain liability insurance coverage of at least $500,000. This coverage can be provided directly by the host or through the booking platform. The Mayor has the authority to adjust this minimum requirement through the rulemaking process.

24-Hour Contact Requirement

Hosts must provide all guests with a 24-hour accessible telephone number to either the host or someone authorized to act on the host's behalf in case of emergencies. This ensures that guests have immediate assistance available if problems arise during their stay.

Multiple Rentals on One Property

The DC regulations do allow hosts to offer multiple short-term rentals at a single property, such as renting out both a bedroom and an in-law suite simultaneously. However, these arrangements must comply with all applicable occupancy limits contained in Titles 11, 12, and 14 of the District of Columbia Municipal Regulations.

Tenant Restrictions

As of early 2022, tenants were prohibited from operating short-term rentals in their rental units. However, it's worth noting that as of October 2024, the District was considering new legislation called the "Tenant and Rowhouse Short-Term Rental Clarification Amendment Act," which would potentially allow renters to share their homes and enjoy the same financial benefits of short-term rentals as homeowners.

The District-wide regulations ensure consistency across all of DC's diverse neighborhoods, from Georgetown to Capitol Hill to Anacostia. By implementing these uniform rules, the District aims to preserve neighborhood character and housing availability while still allowing residents to benefit from the sharing economy and supporting the city's vital tourism industry.

Does Washington Strictly Enforce STR Rules?

The enforcement of short-term rental regulations in Washington, DC presents a mixed picture, with the District government taking a more serious approach to compliance in recent years. Since the full implementation of the Short-Term Rental Regulation Act in early 2022, enforcement has become increasingly stringent, though not uniformly applied across all neighborhoods.

DC's enforcement of short-term rental regulations is moderate compared to other major cities. While the Department of Licensing and Consumer Protection (DLCP) has established clear penalties for violations, the actual enforcement tends to be complaint-driven rather than proactive. This means properties that generate neighbor complaints about noise, parking issues, or other disturbances are more likely to face scrutiny.

The most strictly enforced aspect of DC's regulations is the primary residence requirement. The District has been particularly vigilant about ensuring that short-term rentals only operate in the host's primary residence. According to discussions on BiggerPockets from August 2023, "DC's license division said you don't qualify for short-term rental or vacation rental if DC property isn't your primary residence." This requirement effectively prevents investors from purchasing properties specifically for short-term rental purposes.

Washington, DC, falls on the more restrictive end of the spectrum when compared to other major U.S. cities. The 90-night annual cap for vacation rentals (when the host is not present) is particularly limiting for hosts hoping to maximize revenue from their properties. Cities like Nashville, Miami, and Phoenix offer more permissive environments for short-term rental operators.

The District's regulations are designed to balance tourism opportunities with housing availability for permanent residents. This approach places DC in line with other major cities like Boston, Chicago, and San Francisco that have implemented similar restrictions to prevent the conversion of long-term housing into dedicated short-term rental properties.

Despite the restrictive regulatory environment, many hosts continue to operate in Washington, DC. The primary residence requirement hasn't eliminated short-term rentals but has shifted the market toward owner-occupied properties offering spare rooms or basement apartments.

The short-term rental landscape in Washington, DC is undoubtedly more challenging than in many other cities, but determined hosts who are willing to navigate the regulatory requirements and operate within their primary residences can still build successful rental businesses. The key to success lies in understanding and strictly adhering to the District's regulations while providing exceptional guest experiences to maximize returns within the allowed parameters.

How to Start a Short-Term Rental Business in Washington, DC

Starting a short-term rental business in Washington, DC requires careful planning and strict adherence to the District's comprehensive regulatory framework. The following step-by-step guide will help you navigate the process successfully while ensuring compliance with all applicable rules and regulations.

Verify Your Property Qualifies

Before investing time and money, confirm that your property meets the fundamental requirement of being your primary residence. DC regulations only permit short-term rentals in properties where the owner actually lives and qualifies for the Homestead Tax Deduction. Investment properties purchased specifically for short-term rental purposes are not permitted under current regulations. If you're a tenant rather than an owner, be aware that as of 2025, tenants are generally prohibited from operating short-term rentals in their rental units, though this policy may be evolving.

Research License Types and Choose Accordingly

Determine which type of short-term rental license best suits your hosting plans. If you intend to remain present during guest stays (renting out a spare bedroom or basement while you live upstairs), the "Short-Term Rental License" allows unlimited nights per year. If you plan to rent your entire home while you're away, the "Short-Term Rental: Vacation Rental License" limits you to 90 nights per calendar year. Consider your travel habits and income goals when making this decision.

Obtain a Certificate of Clean Hands

Request a Certificate of Clean Hands from the DC Office of Tax and Revenue. This document verifies that you don't owe more than $100 to the District for fees, fines, taxes, or penalties and that you've filed all required tax returns. The certificate must be issued within 30 days prior to your license application and must be in your name, not a business entity's name.

Secure Liability Insurance

Obtain liability insurance with minimum coverage of $250,000 for your rental property. This can be acquired through a traditional insurance provider or through coverage offered by platforms like Airbnb or VRBO. Keep documentation of this coverage readily available, as you'll need to provide proof during the licensing process.

Complete Homeowners Association Verification (If Applicable)

If your property is part of a condominium, cooperative, or homeowners association, verify that short-term rentals are permitted under the governing documents. You'll need to complete a Short-Term/Vacation Rental Attestation Form confirming that your association allows such rentals. Some buildings in DC explicitly prohibit short-term rentals, so this step is crucial to avoid potential legal issues.

Prepare Property Safety Features

Ensure your property meets all safety requirements, including working smoke detectors, carbon monoxide detectors, fire extinguishers, and unobstructed exit paths. While these items may not need to be documented in your application, you must attest that your property meets these safety standards, and they may be subject to inspection.

Apply for Your License Online

Visit the District of Columbia Short-Term Rental Licensing Platform to begin the application process. Create an Access DC single sign-on account if you don't already have one, register with your basic contact information, and link your account with the address where you'll conduct short-term rentals. Complete the full license application, upload all required documentation, and pay the $104.50 fee for the two-year license.

Register for Tax Collection

Register with the DC Office of Tax and Revenue to ensure proper collection and remittance of the 15.95% sales tax on transient accommodations. While platforms like Airbnb typically collect these taxes on your behalf, you're still required to register and file regular sales tax returns. This registration is separate from your short-term rental license.

Create Listings on Rental Platforms

Once your license is approved, create your listings on platforms like Airbnb and VRBO. Be sure to include your license number in all listings and advertisements, as this is a legal requirement in DC. Also, provide a 24-hour accessible phone number for guests to contact you or your representative in case of emergencies.

Establish a Record-Keeping System

Develop a system to track all bookings, especially if you have a vacation rental license with the 90-night annual limit. Maintain records of guest information, dates of stay, and payment details for at least two years, as these may be requested during compliance checks. For vacation rentals, careful tracking is essential to ensure you don't exceed your annual allowance.

Set Up Professional Cleaning and Maintenance

Arrange for professional cleaning services between guest stays to maintain high standards and positive reviews. Consider establishing relationships with local maintenance professionals who can quickly address any issues that arise during guest stays. Quick response to maintenance issues is crucial for maintaining good ratings on rental platforms.

Create a House Manual and Welcome Guide

Develop comprehensive materials for your guests, including house rules, emergency contact information, neighborhood recommendations, and instructions for using amenities. Clear communication about expectations can help prevent issues with neighbors and ensure a positive experience for your guests.

Starting a short-term rental business in Washington, DC requires navigating a complex regulatory landscape, but with careful planning and attention to detail, it can be a rewarding venture. By following these steps and maintaining strict compliance with District regulations, you can establish a successful and legal short-term rental operation in the nation's capital.

Who to Contact in Washington, DC about Short-Term Rental Regulations and Zoning?

Navigating the complex landscape of short-term rental regulations in Washington, DC often requires direct communication with various government agencies and community resources. Whether you're seeking clarification on licensing requirements, reporting potential violations, or simply looking for guidance on getting started, knowing who to contact can save you significant time and frustration.

Department of Licensing and Consumer Protection (DLCP)

The DLCP is the primary regulatory agency overseeing short-term rental licensing in the District. Their Business and Professional Licensing Administration handles all aspects of short-term rental licensing and enforcement.

1. Phone: (202) 442-4400
2. Email: dcra.businesslicense@dc.gov
3. Address: 1100 4th Street SW, Washington, DC 20024
4. Office Hours: Monday to Friday, 8:30 am to 5:00 pm

For specific questions about your short-term rental license application or renewal, this should be your first point of contact. The DLCP can provide guidance on documentation requirements, application status, and compliance issues.

District of Columbia Short-Term Rental Hotline

DC maintains a dedicated hotline specifically for short-term rental inquiries and complaints. This resource is valuable for both hosts with questions and residents who wish to report potential violations.

Phone: (202) 221-8550

This hotline can be used to report suspected unlicensed rentals, verify if a property has proper licensing, or ask general questions about short-term rental regulations in the District.

Office of Tax and Revenue (OTR)

For tax-related questions, including sales tax registration, filing requirements, and the Certificate of Clean Hands, contact the Office of Tax and Revenue.

1. Phone: (202) 727-4829
2. Address: 1101 4th Street SW, Suite W270, Washington, DC 20024
3. Office Hours: Monday to Friday, 8:15 am to 5:30 pm

Office of Zoning

For questions specifically related to zoning regulations that might affect your short-term rental operation, the Office of Zoning can provide guidance.

1. Phone: (202) 727-6311
2. Address: 441 4th Street NW, Suite 200-S, Washington, DC 20001
3. Office Hours: Monday to Friday, 8:30 am to 5:00 pm

When contacting any of these resources, be prepared with specific questions and relevant information about your property and intended rental operations. Having your address, property details, and specific concerns ready will help you receive the most accurate and helpful information. Remember that regulations can change, so maintaining ongoing relationships with these contacts can help ensure your continued compliance with DC's short-term rental requirements.