Nebraska Short-Term Rental Regulation: A Guide For Airbnb Hosts

What are Short-Term Rental (Airbnb, VRBO) Regulations in Nebraska?

When starting a short-term rental business in Nebraska, it's crucial to familiarize yourself with the state and local regulations. Nebraska State Legislature 18-1758 prohibits municipalities from banning short-term rentals outright, affirming the right of property owners to participate in the market. However, cities and counties can still impose specific rules related to health, safety, and zoning.

In Omaha, for example, short-term rentals must comply with the city's zoning code, which likely means restrictions in certain districts. Property owners must also obtain a license, submit necessary documents, and comply with safety standards and occupancy limits.

Hosts should thoroughly review the requirements in their specific location, secure proper licensing, and maintain organized records for tax purposes. By staying informed and compliant, short-term rental operators can find success in Nebraska's evolving market while contributing positively to their communities.

Short-Term Rental Licensing Requirement in Nebraska

In Nebraska, short-term rental licensing requirements are primarily managed at the local level, as there is no statewide licensing mandate. However, many cities and counties have implemented their own licensing processes. Let's focus on Lincoln, the state capital, as an example of local licensing requirements:

To operate a short-term rental in Lincoln, property owners must obtain a license from the Building and Safety Department. Here's a comprehensive list of requirements and details:

1. License Application: Submit a completed short-term rental license application to the Building and Safety Department.
2. Fee: Pay a $250 licensing fee per rental unit. This fee must be paid annually upon renewal.
3. Separate Licenses: Each short-term rental unit requires its own separate license.
4. Zoning Compliance: Ensure your property complies with local zoning laws and regulations.
5. Safety Standards: Meet all required safety standards, including fire and building codes.
6. Property Description: Provide a detailed description of the rental property.
7. Proof of Ownership: Submit documentation proving property ownership.
8. Contact Information: Provide current contact information for the owner or property manager.
9. Insurance: Show proof of adequate liability insurance coverage.
10. Tax Registration: Register for tax collection with the Nebraska Department of Revenue.
11. Parking Plan: Demonstrate compliance with local parking regulations.
12. Waste Management Plan: Outline how you'll handle waste disposal for the rental.
13. Occupancy Limits: Adhere to the city's occupancy limits based on the number and size of bedrooms.
14. Quiet Hours: Agree to enforce quiet hours between 10 pm and 7 am.

To submit these requirements, applicants should contact:

• Lincoln Building and Safety Department
• 555 S. 10th Street, Suite 203
• Lincoln, NE 68508
• Phone: 402-441-7521

The licensing process typically takes about 30 days from the submission of a complete application. However, this timeline may vary depending on the department's current workload and the completeness of your application.

Operating a short-term rental without a license in Lincoln can result in significant penalties. While specific fine amounts are not provided in the search results, the city has contracted with a third-party company to identify unlicensed rentals and issue violations. This suggests a strict enforcement approach.

It's crucial to note that Lincoln has implemented a 5-year sunset clause for short-term rentals in certain residential areas. This means that after 5 years, no new licenses will be issued in these zones, aiming to phase out short-term rentals and preserve neighborhood character.

Remember, these requirements are specific to Lincoln. Other cities in Nebraska may have different licensing processes and requirements. Always check with your local city or county government for the most up-to-date and accurate information regarding short-term rental regulations in your specific area.

Required Documents for Nebraska Short-Term Rentals

When applying for a short-term rental license in Nebraska, property owners must submit several documents to demonstrate compliance with local regulations. While exact requirements may vary by city or county, here are some commonly requested documents:

Completed Short-Term Rental License Application: This form collects essential information about the applicant, property owner (if different), and the rental property itself. It can typically be obtained from the local Building and Safety Department or downloaded from the city's official website.

Proof of Ownership or Written Authorization: Applicants must provide evidence of property ownership, such as a deed or title. If the applicant is not the property owner, they must submit a notarized letter from the owner granting permission to operate a short-term rental.

Floor Plans with Room Dimensions: Detailed floor plans help verify compliance with occupancy limits and safety standards. These plans should clearly label each room and include dimensions.

Parking Plan: Many cities require short-term rentals to provide off-street parking for guests. A parking plan should demonstrate compliance with local parking regulations, indicating the number and location of dedicated spaces.

Proof of Insurance: Short-term rental operators must carry liability insurance, typically with a minimum coverage of $500,000. A copy of the insurance policy or a certificate of insurance must be submitted with the license application.

Signed Affidavit: Applicants are often required to sign an affidavit agreeing to comply with all short-term rental rules and regulations, including occupancy limits, safety standards, and noise restrictions.

Tax Registration: Short-term rental operators must register with the Nebraska Department of Revenue for tax collection purposes. Proof of registration or a tax ID number may be required during the licensing process.

Safety Inspection Reports: Some cities may require a safety inspection to ensure the rental property meets fire, building, and health codes. Inspection reports from the appropriate authorities must be submitted with the license application.

Neighbor Notification: Certain jurisdictions may require applicants to notify adjacent property owners of their intent to operate a short-term rental. Proof of notification, such as certified mail receipts, may be necessary.

Good Neighbor Policy: Some cities ask short-term rental operators to create and submit a "good neighbor policy" outlining expectations for guest behavior, noise levels, and parking to minimize community impact.

These documents serve to ensure that short-term rentals operate safely, legally, and in harmony with the surrounding community. Failure to provide required documentation can result in delays or denial of a license application.

For the most accurate and up-to-date information on required documents, always consult your local city or county government's official website or contact the department responsible for short-term rental licensing directly.

Nebraska Short-Term Rental Taxes

Operating a short-term rental in Nebraska involves navigating various tax obligations. Understanding these taxes is crucial for compliance and financial planning. Here's a breakdown of the primary taxes that apply to short-term rentals in Nebraska:

State Lodging Tax

Nebraska imposes a state lodging tax of 1% on all short-term rentals5. This tax applies uniformly across the state and is mandatory for all operators.

Local Lodging Tax

In addition to the state tax, some counties in Nebraska may levy an additional lodging tax of up to 4%. The exact rate varies by location, so it's essential to check with your local tax authority for the specific rate in your area.

Sales Tax

Short-term rentals in Nebraska are subject to state and local sales taxes. The state sales tax rate is 5.5%, but total rates can vary by city and county. For example, in Lincoln, the total tax rate on short-term rentals is 12%, which includes state, county, and city taxes.

Occupation Tax

Some municipalities in Nebraska impose an occupation tax on short-term rentals. This tax is often a percentage of the rental fee or a flat rate per night. The rates and application can vary significantly between cities.

Income Tax

While not specific to short-term rentals, income generated from your rental business is subject to state and federal income taxes. The rate will depend on your total income and tax bracket.

Possible Write-offs and Deductions

Short-term rental operators in Nebraska can take advantage of several deductions to reduce their tax liability:

1. Depreciation: You can deduct the cost of your rental property over time using depreciation methods approved by the IRS.
2. Mortgage Interest: If you have a mortgage on your rental property, the interest paid is typically deductible.
3. Property Taxes: Local property taxes paid on your rental property are generally deductible.
4. Operating Expenses: Costs such as cleaning, maintenance, utilities, and insurance can be deducted.
5. Furnishings and Supplies: Expenses for furniture, linens, and other supplies for your rental can be written off.
6. Marketing and Advertising: Costs associated with promoting your rental are deductible.
7. Professional Fees: Expenses for legal, accounting, or property management services are typically deductible.
8. Travel Expenses: If you travel to manage or maintain your rental property, these costs may be deductible.
9. Home Office: If you use part of your home exclusively for managing your rental business, you may be eligible for a home office deduction.

Remember, tax laws can be complex and are subject to change. It's advisable to consult with a tax professional familiar with Nebraska's short-term rental regulations to ensure you're maximizing your deductions while remaining compliant with all tax obligations.

By understanding and properly managing these taxes and deductions, short-term rental operators in Nebraska can optimize their business finances and ensure compliance with state and local regulations.

Does Nebraska Strictly Enforce STR Rules?

Nebraska, particularly in cities like Lincoln and Omaha, has taken a relatively strict approach to enforcing short-term rental (STR) rules compared to some other states. While the state itself doesn't ban STRs outright, individual municipalities have implemented robust regulatory frameworks that are actively enforced.

Lincoln, in particular, has demonstrated a strong commitment to enforcing its STR regulations. The city has contracted with a third-party company to identify unlicensed rentals and issue violations, indicating a proactive approach to enforcement. This strict stance is further evidenced by the 5-year sunset clause for STRs in certain residential areas, which aims to phase out short-term rentals and preserve neighborhood character.

Is Nebraska Airbnb friendly? Compared to other cities across the United States, Nebraska falls somewhere in the middle in terms of STR friendliness. It's not as welcoming as some cities that have minimal regulations, but it's also not as restrictive as places that have implemented outright bans. The state's approach can be characterized as cautious and regulated, with a focus on balancing the economic benefits of STRs with community concerns.

Do hosts operate in Nebraska despite the rules? Yes, many hosts continue to operate STRs in Nebraska, particularly in high-demand areas and during popular events. For instance, in Lincoln, there's strong demand driven by Husker football games and the annual state fair. However, hosts are increasingly focusing on areas with fewer zoning restrictions to navigate the regulatory landscape more easily.

In conclusion, Nebraska does strictly enforce STR rules, especially in cities like Lincoln and Omaha. While it's not the most Airbnb-friendly state, it's also not entirely hostile to STRs. Hosts continue to operate, but they face significant regulatory hurdles and must be diligent in complying with local ordinances. The strict enforcement and comprehensive regulations make Nebraska a challenging, though not impossible, environment for STR operators.

How to Start a Short-Term Rental Business in Nebraska

Starting a short-term rental business in Nebraska requires careful planning and adherence to local regulations. Here's a comprehensive guide to help you get started:

Research Local Regulations

• Thoroughly investigate the short-term rental regulations in your specific city or county. Nebraska allows municipalities to set their own rules, so requirements can vary significantly. Pay close attention to zoning restrictions, licensing requirements, and occupancy limits.
• Tip: Contact your local Building and Safety Department for the most up-to-date information.

Choose Your Property

• Select a property that complies with local zoning laws and has the potential for high occupancy rates. Consider factors like proximity to attractions, parking availability, and neighborhood character.
• Tip: Look for areas with fewer STR restrictions to simplify the regulatory process.

Secure Financing

• If you're purchasing a property, explore financing options such as conventional mortgages, FHA loans, or investment property loans. Ensure you have sufficient capital for initial costs and ongoing expenses.
• Tip: Consider working with a mortgage broker familiar with investment properties to find the best rates.

Obtain Necessary Licenses and Permits

• Apply for all required licenses and permits from your local government. This typically includes a short-term rental license and may involve safety inspections.
• Tip: Create a checklist of all required documents to streamline the application process.

Register for Tax Collection

• Register with the Nebraska Department of Revenue for tax collection purposes. You'll need to collect and remit state sales tax, local lodging taxes, and any applicable occupation taxes.
• Tip: Consider using automated tax collection services offered by platforms like Airbnb to simplify this process.

Prepare Your Property

• Ensure your property meets all safety standards and is attractively furnished. Install necessary amenities and consider professional staging to make your listing stand out.
• Tip: Invest in quality linens, towels, and basic kitchen supplies to enhance guest experience.

Set Up Your Business Structure

• Decide on a business structure (LLC, sole proprietorship, etc.) and register your business with the Nebraska Secretary of State. Consider consulting with a lawyer or accountant for advice.
• Tip: An LLC can provide personal liability protection and potential tax benefits.

Obtain Insurance

• Secure appropriate insurance coverage, including liability insurance and possibly additional short-term rental insurance. Many cities in Nebraska require proof of insurance for licensing.
• Tip: Shop around for policies specifically designed for short-term rentals.

Create a Management Plan

1. Develop a plan for managing bookings, cleaning, maintenance, and guest communication. Decide whether you'll handle these tasks yourself or hire a property management company.
2. Tip: Create detailed checklists for cleaning and maintenance to ensure consistency.

List Your Property

1. Create compelling listings on popular short-term rental platforms like Airbnb, VRBO, and local booking sites. Include high-quality photos and detailed descriptions of your property and its amenities.
2. Tip: Highlight unique features of your property and nearby attractions to make your listing stand out.

Set Competitive Pricing

1. Research similar properties in your area to set competitive rates. Consider using dynamic pricing tools to adjust rates based on demand and seasonality.
2. Tip: Offer discounts for longer stays to encourage extended bookings and reduce turnover.

Develop a Marketing Strategy

1. Create a marketing plan to promote your rental. This could include social media marketing, partnering with local businesses, or creating a dedicated website.
2. Tip: Encourage guests to leave reviews and offer incentives for referrals.

Establish House Rules

1. Clearly communicate your house rules to guests to prevent issues and ensure compliance with local regulations. Include information on noise restrictions, parking, and maximum occupancy.
2. Tip: Create a welcome book with house rules, local recommendations, and emergency information.

Monitor and Adjust

1. Regularly review your business performance, guest feedback, and local market conditions. Be prepared to adjust your strategy as needed to stay competitive and compliant.
2. Tip: Join local short-term rental associations or online forums to stay informed about industry trends and regulatory changes.

By following these steps and staying informed about local regulations, you can establish a successful short-term rental business in Nebraska. Remember, the key to long-term success is providing excellent guest experiences while maintaining positive relationships with your neighbors and local community.

Who to Contact in Nebraska about Short-Term Rental Regulations and Zoning?

When seeking information about short-term rental regulations and zoning in Nebraska, it's important to contact the appropriate local authorities. Since regulations can vary significantly between cities and counties, here are some key contacts for major areas in Nebraska:

Lincoln

Building and Safety Department

• 555 S 10th St, Suite 203
• Lincoln, NE 68508
• Phone: 402-441-7521
• Website: https://www.lincoln.ne.gov/City/Departments/Building-Safety

STR Complaint Hotline

• Phone: 402-441-STR1 (7871)
• Website: https://www.lincoln.ne.gov/City/Departments/Building-Safety/Short-Term-Rentals/Complaints

Lincoln-Lancaster County Planning Department

1. 555 S 10th St, Suite 213
2. Lincoln, NE 68508
3. Phone: 402-441-7491
4. Website: https://www.lincoln.ne.gov/City/Departments/Planning-Department

Omaha

Planning Department

1. 1819 Farnam Street, Suite 1100
2. Omaha, NE 68183
3. Phone: 402-444-5150
4. Email: planning@cityofomaha.org
5. Website: https://planninghcd.cityofomaha.org/

State-Level Resources

Nebraska Department of Revenue

1. (For tax-related inquiries)
2. Phone: 800-742-7474
3. Website: https://revenue.nebraska.gov/

Useful Communities and Forums

Omaha Airbnb Hosts Facebook Group: https://www.facebook.com/groups/OmahaAirbnbHosts/

Bigger Pockets Nebraska Real Estate Forum: https://www.biggerpockets.com/forums/569

Nebraska REALTORS® Association: Website: https://www.nebraskarealtors.com/

Reddit r/Omaha: https://www.reddit.com/r/Omaha/

These resources can provide valuable information and support for short-term rental hosts in Nebraska. Remember to always verify the most current regulations with official sources, as rules and contact information may change over time. Joining local host communities can also offer practical insights and peer support as you navigate the short-term rental landscape in Nebraska.

What Do Airbnb Hosts in Nebraska on Reddit and Bigger Pockets Think about Local Regulations?

Hosts in Nebraska, particularly in cities like Omaha and Lincoln, have expressed mixed opinions about local short-term rental regulations on various online forums. Here's a summary of their thoughts and experiences:

Frustration with Zoning Restrictions

1. On Bigger Pockets, a user expressed frustration with Lincoln's proposed ordinance #523, stating: "Lincoln's proposed ordinance #523 will change my use from a lawful one to an unlawful one, and not permit me to continue the use, contrary to ORS 215.130(5)."
2. Another user echoed this sentiment: "Instead of applying the new standard prospectively, the Ordinance will violate state law by taking away existing lawful uses."

Confusion Over Occupancy Limits

On Reddit's r/Omaha, there's confusion and discussion about occupancy limits: "More specifically, city ordinances prohibit more than three unrelated people living together in a single-family residence. So you can't buy a house and rent the rooms out to your friends, but, by all means, buy up all the affordable single-family homes in town and turn them into hotels."

Overall, the sentiment among Nebraska hosts seems to be a mix of frustration with regulatory complexities, confusion about specific rules, and concern about the impact of STRs on local communities. Many are seeking clarity on regulations and expressing a desire for more balanced approaches that allow for STR operations while addressing community concerns.

Disclaimer: While we here at BNBCalc strive to keep all of our regulation guides updated and accurate with all the latest local laws, we still do not suggest using them as your sole or primary source for local regulations. We also do not recommend you rely on the third-party sources we link to or reference, and we are not responsible for any of the information on these third-party sites. These guides are for entertainment purposes only and only provide basic information and should not be considered as legal advice.

We highly recommend directly contacting the responsible parties for each area and hearing what their officials have to say. Ultimately, it's your responsibility as an investor to ensure you fully comply with the local laws, and it's best to speak with professionals before making an investment decision.