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The Complete Delaware Airbnb Host Lodging Tax Guide: Airbnb Delaware Occupancy Tax Breakdown

Written by:
Jeremy Werden
April 28, 2025

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As a short-term rental host in Delaware, understanding your tax obligations is crucial for your success. The First State has recently implemented significant changes to its lodging tax structure that will affect all Airbnb and vacation rental operators. Today, we break down exactly what you need to know about Delaware's lodging taxes in 2025.
State-Wide Tax Requirements for Connecticut Airbnb
Starting January 1, 2025, Delaware implemented a new statewide short-term rental lodging tax that applies to all properties rented for 31 consecutive nights or less. It's a 4.5% tax on all short-term rental transactions. However, this tax is only applied to the base rent charged to guests. Other charges such as linen rental fees, cleaning fees, insurance fees, security deposits, and other add-on fees are not usually considered part of the rent.
Example: For a 3-night stay with a nightly rate of $200.
- Base rental amount: $600
- Delaware state lodging tax (4.5%): $27
- Total charged to guest: $627
County and City-Specific Tax Requirements
In addition to the state tax, Delaware counties and a couple of cities now have the authority to impose their own lodging taxes on short-term rentals in their jurisdiction.
Sussex County
Sussex County has implemented a 3% lodging tax on short-term rentals in its unincorporated areas. It was made effective for all bookings in 2025 and beyond. Hosts can remit their taxes to the State of Delaware tax system.
Example: For a 3-night stay with a nightly rate of $250.
- Base rental amount: $750
- Delaware state lodging tax (4.5%): $33.75
- Sussex County lodging tax (3%): $22.50
- Total tax: $56.25
- Total charged to guest: $806.25
New Castle County
Similar to Sussex County, New Castle County also imposes a lodging tax on short-term rentals. They have a 3% tax rate for all public accommodations, which includes the total rent amount along with cleaning fees or extra service fees.
Example: For a 2-night stay with a nightly rate of $160 and a cleaning fee of $40.
- Base rental amount: $320
- Total taxable amount: $320 + $40 (cleaning fee) = $360
- Delaware state lodging tax (4.5%): $16.20
- New Castle County lodging tax (3%): $10.80
- Total tax: $27.00
- Total charged to guest: $387.00
Rehoboth Beach
Unfortunately for Rehoboth Beach hosts, the city has one of the highest municipal tax rates in the entire state of Delaware. They impose a 7% rental tax for residential properties, including those listed on Airbnb, VRBO, and other booking platforms.
Example: For a 4-night stay with a nightly rate of $300.
- Base rental amount: $1,200
- Delaware state lodging tax (4.5%): $54
- Rehoboth Beach rental tax (7%): $84
- Total tax: $138
- Total charged to guest: $1,338
Bethany Beach
Similar to Rehoboth Beach, Bethany Beach is another city with a high tax rate of 7%. It's a local tax on short-term rentals, and anyone who rents out their property for 30 days or less are subject to it.
Example: For a 5-night stay with a nightly rate of $220.
- Base rental amount: $1,100
- Delaware state lodging tax (4.5%): $49.50
- Bethany Beach local tax (7%): $77
- Total tax: $126.50
- Total charged to guest: $1,226.50
Dewey Beach
Aspiring Airbnb hosts and short-term rental owners located in Dewey Beach will be happy to hear that the city has a more reasonable tax rate. Dewey Beach only imposes a 3% local tax on all short-term rental stays made within the city.
Example: For a 2-night stay with a nightly rate of $275.
- Base rental amount: $550
- Delaware state lodging tax (4.5%): $24.75
- Dewey Beach local tax (3%): $16.50
- Total tax: $41.25
- Total charged to guest: $591.25
Wilmington
While not yet fully implemented, Wilmington has proposed a new lodging tax specifically targeting short-term rentals. A new legislation sponsored by Councilwoman Bergetta Fields proposes a 2% tax on all rent collected by short-term rental owners.
Example (If implemented): For a 3-night stay with a nightly rate of $190.
- Base rental amount: $570
- Delaware state lodging tax (4.5%): $25.65
- Proposed Wilmington lodging tax (3%): $11.40
- Total tax: $37.05
- Total charged to guest: $607.05
Wrapping Things Up
Delaware's new lodging and occupancy taxes shook the state's Airbnb market. Hosts should carefully calculate their obligations based on state, county, and city rates to ensure proper compliance. Before entering the Delaware STR market, aspiring hosts should keep in mind the new lodging taxes they will be greeted with.
I highly recommend visiting the official Delaware government website for more information.
⚡️
Reveal any property's Airbnb and Long-Term rental profitability
Buy this property and list it on Airbnb.