Paradise Township, Pennsylvania Short-Term Rental Regulation: A Guide For Airbnb Hosts

Starting a Short-Term Rental Business in Paradise Township

Paradise Township, located in Monroe County, Pennsylvania, has implemented specific regulations for short-term rentals (STRs), such as those listed on platforms like Airbnb and VRBO. If you're considering starting a short-term rental business in this picturesque Pocono Mountains community, it's crucial to understand and comply with the local ordinances.

In Paradise Township, short-term rentals are defined as stays of 30 days or less. The township has taken a proactive approach to regulating STRs, balancing the economic benefits they bring with the need to maintain community standards and address potential nuisances.

To operate a short-term rental in Paradise Township, property owners must obtain a Short-Term Rental License from the Zoning Officer. This licensing requirement is a key component of the township's regulatory framework, ensuring that all STR operators are registered and accountable.

Here are the main requirements for starting and operating a short-term rental in Paradise Township:

• Zoning Restrictions: As of early 2022, Paradise Township adopted zoning district requirements that allow STRs only in the Business Districts (B-1 and B-2), also known as Resort Development Districts. Short-term rentals are not permitted in residential districts. This zoning restriction significantly limits the areas where STRs can operate, so it's essential to verify the zoning of your property before pursuing an STR business.
• Occupancy Limits: The township has set specific occupancy limits for short-term rentals. Overnight occupancy is restricted to no more than two persons per bedroom plus four additional persons per dwelling unit. For example, a three-bedroom home could accommodate a maximum of 10 overnight guests (3 bedrooms x 2 persons + 4 additional persons).
• Day Guests: The maximum number of day guests allowed at any one time, in addition to overnight occupants, is limited to 75% of the maximum overnight occupancy.
• Septic System Requirements: The number of bedrooms permitted for a short-term rental cannot exceed the number approved on the property's sewage permit. Properties advertising more than five bedrooms must provide proof that the septic system can handle the additional flow.
• Parking: Adequate off-street parking must be provided for all short-term rental guests. Parking on public streets or rights-of-way is prohibited.
• Noise and Conduct: The ordinance includes provisions to prevent disorderly conduct and excessive noise. Property owners are responsible for ensuring their guests comply with these regulations.
• Safety Requirements: All short-term rentals must be equipped with interconnected smoke detectors, carbon monoxide detectors, fire extinguishers, and other safety features as specified in the ordinance.
• Visible Notice: A clearly visible notice must be posted within the rental unit containing important information such as the owner's contact details, maximum occupancy, and parking rules.
• Annual Renewal: Short-term rental licenses must be renewed annually, ensuring ongoing compliance with township regulations.

To start your STR business in Paradise Township, you'll need to submit a comprehensive application to the Zoning Officer. This application should include detailed floor plans, site plans showing parking areas, copies of your Pennsylvania Sales and Use Tax License, and proof of adequate insurance coverage.

It's worth noting that Paradise Township's approach to short-term rentals is more restrictive compared to some other areas in the Poconos. For instance, while Paradise Township limits STRs to business districts, nearby Middle Smithfield Township allows them in all zoning areas.

Short-Term Rental Licensing Requirement in Paradise Township

To operate a short-term rental (STR) in Paradise Township, Pennsylvania, property owners must obtain a Short-Term Rental License from the Zoning Officer. The licensing process involves several requirements and steps:

Application: Submit a comprehensive Short-Term Rental License application to the Zoning Officer, including:

1. Owner's name, address, telephone number, and email address
2. 24-hour contact information for the owner or managing agency/agent
3. Floor plans showing total habitable floor space and number of bedrooms
4. Site plan indicating on-site parking spaces
5. Information about the sewage disposal system if not on central sewer
6. Copies of Monroe County Hotel Room Excise Tax Certificate and Pennsylvania Sales and Use Tax License
7. Signatures of both the owner and local managing agent/contact person
8. Trespass Waiver allowing property access for inspections
9. Copy of the current recorded property deed
10. Proof of agreement with a licensed trash hauler
11. Evidence of no delinquent taxes related to STRs
12. Certificate of Insurance showing at least $500,000 in general liability coverage

Fees: Pay the required Short-Term Rental License fee, which is established by resolution of the Board of Supervisors.

Inspections: The property must pass inspections to ensure compliance with health, safety, and occupancy standards.

Renewal: Licenses must be renewed annually, requiring new inspections and updated information on any changes to the property or its management.

The application should be submitted to the Paradise Township Zoning Officer. While the exact processing time is not specified, the township will prescribe forms and procedures for license applications.

Operating an STR without a valid license is a violation of the township ordinance. Penalties for non-compliance can be severe:

1. Fines ranging from $100 to $1,000 per violation
2. Each day of violation constitutes a separate offense
3. Potential imprisonment to the extent allowed by law for summary offenses
4. Payment of all court costs and reasonable attorney's fees incurred by the township in enforcement proceedings

Additionally, the Zoning Officer has the authority to revoke or deny renewal of a Short-Term Rental License for violations. The first set of three uncured or repeated violations can result in a six-month suspension of the license.

Required Documents for Paradise Township Short-Term Rentals

To operate a short-term rental in Paradise Township, Pennsylvania, property owners must submit the following documents as part of their Short-Term Rental License application:

1. Completed Short-Term Rental License Application: This form captures essential information about the property, owner, and managing agency. It can be obtained from the Paradise Township Zoning Officer.
2. Floor Plans: Detailed drawings showing the total habitable floor space and number of bedrooms in the rental unit. This helps determine occupancy limits.
3. Site Plan: A diagram indicating the location and number of on-site parking spaces. If not on a central sewer system, include the location, approximate age, and capacity of the sewage disposal system.
4. Monroe County Hotel Room Excise Tax Certificate: Proves registration for the local hotel tax. Obtain this from the Monroe County Treasurer's Office.
5. Pennsylvania Sales and Use Tax License: Demonstrates compliance with state tax requirements. Apply through the Pennsylvania Department of Revenue.
6. Trespass Waiver: A signed document allowing the Zoning Officer and Building Code Official to access the property for inspections. This form is provided by the township.
7. Current Recorded Property Deed: Establishes ownership of the short-term rental property. Obtain from the Monroe County Recorder of Deeds office.
8. Trash Hauler Agreement: A copy of the current contract with a licensed trash hauler for the short-term rental.
9. Tax Compliance Evidence: Proof that there are no delinquent Monroe County Hotel Room Excise Tax or Pennsylvania sales/use taxes due for the property.
10. Certificate of Insurance: Documentation of at least $500,000 in general liability insurance coverage for the short-term rental, issued by an insurance company licensed in Pennsylvania.
11. Sewage Permit (if applicable): For properties advertising more than five bedrooms, proof that the septic system is adequate to handle additional flows, approved by the Sewage Enforcement Officer.
12. Signatures: The application must be signed by both the property owner and the local managing agent or contact person.

These documents ensure that short-term rentals in Paradise Township meet safety standards, comply with local and state regulations, and maintain accountability for property owners. The township may prescribe additional forms or procedures for license applications as needed.

Paradise Township Short-Term Rental Taxes

Short-term rental operators in Paradise Township, Pennsylvania, are subject to several taxes that apply to their rental income. Understanding these tax obligations is crucial for running a compliant and profitable short-term rental business.

1. Pennsylvania Hotel Occupancy Tax (6%): This state-wide tax applies to all short-term rentals in Pennsylvania, including those in Paradise Township. It is collected on rentals of rooms, apartments, and houses arranged through online or third-party brokers.
2. Monroe County Hotel Room Excise Tax (3%): In addition to the state tax, Monroe County imposes a 3% hotel room excise tax on short-term rentals.
3. Local Tax Enabling Act 511: Paradise Township may impose additional local taxes under this act. While the exact rate for short-term rentals is not specified, the township's budget indicates revenue from this source.
4. Pennsylvania Sales and Use Tax: Short-term rental operators must obtain a Pennsylvania Sales and Use Tax License and collect this tax from guests.
5. Federal Income Tax: Rental income is subject to federal income tax, reported on Schedule E of your tax return.
6. Pennsylvania Personal Income Tax: Rental income is also taxable at the state level in Pennsylvania.

The combined tax rate for short-term rentals in Paradise Township can be significant, potentially reaching 9% or more when accounting for state, county, and local taxes.

Possible Write-offs and Deductions

Short-term rental operators in Paradise Township may be eligible for several tax deductions to offset their rental income:

1. Mortgage Interest: Interest paid on a mortgage for the rental property is typically deductible.
2. Property Taxes: Annual property taxes paid on the rental property can be deducted5.
3. Utilities: Expenses for utilities such as water, electricity, gas, internet, cable, and trash removal may be deductible for the periods when the property is rented out.
4. Repairs and Maintenance: Costs associated with keeping the property in good condition for renters are generally deductible.
5. Insurance: Premiums paid for property insurance and any specific short-term rental insurance can be written off.
6. Depreciation: The IRS allows for deduction of depreciation on rental properties, which can significantly reduce taxable income.
7. Professional Services: Fees paid to property managers, accountants, or lawyers for services related to your rental business may be deductible.
8. Supplies and Amenities: Costs for items provided to guests, such as toiletries, linens, or welcome baskets, can often be deducted.
9. Marketing and Advertising: Expenses related to promoting your rental, including listing fees on platforms like Airbnb or VRBO, are typically deductible.
10. Travel Expenses: If you travel to check on or maintain your rental property, these costs may be deductible.

It's important to note that the ability to claim these deductions may depend on how often you rent out your property and whether you also use it for personal purposes. The 14-day rule is particularly significant: if you rent your property for 14 days or less in a year, you may not need to report the rental income, but you also cannot claim rental expense deductions.

Pennsylvania Wide Short-Term Rental Rules

While Pennsylvania does not have comprehensive state-wide regulations specifically for short-term rentals, there are some important state-level rules that affect short-term rental hosts in Paradise Township and across the commonwealth:

1. Hotel Occupancy Tax: Short-term rental operators in Pennsylvania must collect and remit a 6% hotel occupancy tax on their rental income. This tax applies to rentals of rooms, apartments, and houses arranged through online platforms or third-party brokers.
2. Sales and Use Tax: Short-term rental hosts are required to obtain a Pennsylvania Sales and Use Tax License and collect this tax from guests. However, it's important to note that third-party booking agents often collect these taxes on behalf of their hosts.
3. Tax Registration: Before collecting any taxes, operators must register for a tax license through the Pennsylvania Department of Revenue's myPATH system.
4. Income Tax Reporting: Rental income must be reported on federal and state tax returns. For rentals less than 30 days, income should be reported on Tax Schedule C, while income from longer rentals uses Schedules E or R.
5. Local Tax Enabling Act 511: This act allows municipalities to impose additional local taxes on short-term rentals, though the specific rates may vary by location.
6. Third-Party Tax Collection: The Pennsylvania Department of Revenue has clarified that homeowners who exclusively use third-party booking agents for their rentals may not need to obtain a separate Sales, Use, and Hotel Occupancy Tax license, as these platforms often handle tax collection and remittance.
7. Insurance Requirements: While not a state-wide mandate, many municipalities in Pennsylvania require short-term rental operators to maintain a minimum level of liability insurance coverage.
8. Zoning Considerations: Although zoning is typically handled at the local level, state law provides the framework for municipalities to regulate land use, which can affect where short-term rentals are permitted to operate.

It's crucial for short-term rental hosts in Paradise Township to understand that while these state-wide rules provide a general framework, local regulations often impose additional requirements. Hosts should always consult with local authorities and consider seeking professional advice to ensure full compliance with both state and local laws governing short-term rentals.

Does Paradise Township Strictly Enforce STR Rules?

Paradise Township takes a relatively strict approach to enforcing its short-term rental (STR) regulations, making it less Airbnb-friendly compared to some other municipalities in the Pocono region. The township has implemented comprehensive rules and actively enforces them to maintain community standards and address potential nuisances associated with STRs.

In early 2022, Paradise Township adopted zoning district requirements that significantly restrict where STRs can operate. These regulations allow short-term rentals only in the Business Districts (B-1 and B-2), also known as Resort Development Districts. This zoning restriction effectively prohibits STRs in residential areas, which is a more stringent approach compared to some neighboring municipalities.

The township requires all STR operators to obtain a Short-Term Rental License from the Zoning Officer, which must be renewed annually. This licensing process involves thorough inspections and compliance with various standards, including occupancy limits, parking requirements, and safety measures. The renewal process allows the township to maintain ongoing oversight of STR properties.

Paradise Township's enforcement stance is evident in its penalty structure. Violations of the STR ordinance can result in fines ranging from $100 to $1,000 per violation, with each day of non-compliance considered a separate offense. Additionally, the township has the authority to revoke or deny renewal of STR licenses for repeated violations, demonstrating a serious commitment to enforcing its regulations.

Despite these strict rules, some property owners in Paradise Township do attempt to operate STRs without proper licensing or in non-permitted areas. However, the township's active enforcement and the potential for significant penalties make it risky for hosts to operate outside the established regulations.

Compared to more STR-friendly areas in the Poconos, such as Middle Smithfield Township or parts of Coolbaugh Township, Paradise Township's approach is notably more restrictive. This stance has led some potential STR operators to look elsewhere in the region for investment opportunities.

How to Start a Short-Term Rental Business in Paradise Township

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

Research and understand local regulations: Familiarize yourself with Paradise Township's short-term rental ordinances. As of early 2022, short-term rentals are only allowed in Business Districts (B-1 and B-2), also known as Resort Development Districts. Ensure your property is in a permitted zone before proceeding.

Choose a suitable property: Select a property that meets Paradise Township's zoning requirements for short-term rentals. Consider factors like location, amenities, and proximity to attractions. If you don't already own a property, focus your search on the designated Business Districts.

Obtain necessary licenses and permits: Apply for a Short-Term Rental License from the Paradise Township Zoning Officer. This process involves submitting a comprehensive application, including floor plans, site plans, and proof of insurance. Be prepared to pay the required licensing fee.

Register for tax purposes: Obtain a Pennsylvania Sales and Use Tax License and a Monroe County Hotel Room Excise Tax Certificate. You'll need to collect and remit both state and local taxes on your rental income.

Prepare your property: Ensure your property meets all safety requirements outlined in the Paradise Township ordinance. This includes installing interconnected smoke detectors, carbon monoxide detectors, and fire extinguishers. Make sure you have adequate off-street parking for guests.

Set up your rental: Furnish and equip your rental property to meet guest expectations. Consider hiring a professional photographer to showcase your property's best features.

Create a management plan: Designate a local contact person available 24/7 to handle issues and complaints. This could be yourself, a property manager, or another responsible individual.

List your property: Create listings on popular short-term rental platforms like Airbnb or VRBO. Craft a compelling description, set competitive rates, and establish clear house rules.

Implement a booking and management system: Use a property management system to handle reservations, guest communications, and maintenance scheduling.

Comply with ongoing requirements: Renew your Short-Term Rental License annually, maintain accurate records, and stay informed about any changes to local regulations.

Tips for success:

1. Thoroughly screen guests to ensure they understand and will comply with local regulations and your house rules.
2. Maintain open communication with neighbors to address any concerns promptly.
3. Consider offering unique amenities or experiences to make your rental stand out in the competitive Pocono Mountains market.
4. Stay informed about changes in local STR regulations and adapt your business accordingly.
5. Prioritize guest satisfaction to earn positive reviews and repeat bookings.

By following these steps and maintaining compliance with Paradise Township's regulations, you can establish a successful short-term rental business in this picturesque Pocono Mountains community.

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

For information about short-term rental regulations and zoning in Paradise Township, Pennsylvania, the following contacts and resources are available:

Paradise Township Office:

• Address: 5912 Paradise Valley Rd, Cresco, PA 18326
• Phone: (570) 595-9880
• Office Hours: Monday through Thursday, 8:30am – 4:00pm (Closed Fridays)

Zoning Officer:

• SFM Consulting LLC serves as the Zoning Officer for Paradise Township
• Contact: Shawn McGlynn or Jennifer McGlynn

Paradise Township Planning & Zoning Department:

• Phone: (570) 595-9880
• For questions about zoning regulations and short-term rental ordinances

Monroe County Planning Commission:

• For broader county-level planning and zoning information
• Phone: (570) 517-3100

Paradise Township Website:

Visit https://www.paradisetownship.com for forms, ordinances, and updates

For short-term rental hosts looking for community support and discussions, the following online resources may be helpful:

Reddit:

• r/Poconos subreddit: Hosts discuss local short-term rental issues and experiences
• r/airbnb_hosts: General forum for Airbnb hosts, including discussions on regulations

Facebook Groups:

While specific groups for Paradise Township weren't found, there are larger STR host groups with over 100,000 members that may provide useful insights

BiggerPockets Forums:

The Real Estate Investment forum often includes discussions on short-term rentals in various locations, including the Poconos area

When contacting officials or participating in online communities, remember to be respectful and professional. Keep in mind that regulations can change, so it's important to verify information directly with the township for the most up-to-date and accurate guidance on short-term rental operations in Paradise Township.