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Another hurdle for home based businesses

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OldTart
(@the-oldtart)
Expert

We need some halos distributed here for those so perfect.

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Posted : September 2, 2016 1:34 pm
speee1dy
(@speee1dy)
Expert

biting my tongue

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Posted : September 2, 2016 1:54 pm
Alana33
(@alana33)
Expert

And pitchforks for those that aren't.

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Posted : September 2, 2016 1:56 pm
Gator's Mom
(@gators_mom)
Trusted Member

Among other things, I operate a couple of AirBNB's here that make a good amount of income. I don't have a business license, don't pay tax on the earnings (but don't claim the expenses either) and haven't had a fire inspection. AirBNB transfers the funds directly to my bank account in the states. I know a few AirBNB operator's the do pay tax and such, but, they're the exception. The vast majority that I know don't.

That's ballsy - you publicly market and don't think anyone from local hotels will check and complain? Are you getting a 990?

Wow I thought if in any area, VI would be tight on the reins in the hospitality business.

Does your property insurer know you're in the short term rental business?

I meant 1099. AirBNB says it sends 1099's if you make more than $20K in a year. If that's the case IRS gets a copy as well if you have a stateside bank account. If each unit is a separate cost center I assume you're avoiding this consequence.

My guess is you're probably long-term leasing units and converting to AirBNB possibly without landlords knowing this.

Limited risk - with promise of a reasonable return. Quick exit.

Ingenious in kind of a smarmy unethical way.

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Posted : September 2, 2016 4:04 pm
IslandHops
(@IslandHops)
Trusted Member

Someone should start a darknet for underground business tips 😎

Or, we could just follow the lead of some of our esteemed elected officials!

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Topic starter Posted : September 2, 2016 4:17 pm
OldTart
(@the-oldtart)
Expert

Someone should start a darknet for underground business tips 😎

http://www.start-home-business.org/Underground-Economy.html

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Posted : September 2, 2016 4:26 pm
sunshinefun
(@sunshinefun)
Trusted Member

Go down the Tor Browser rabbit hole to the real darknet.

There are lots of interesting home-based businesses down there.

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Posted : September 2, 2016 7:30 pm
Scubadoo
(@Scubadoo)
Trusted Member

We need some halos distributed here for those so perfect.

lol:-)

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Posted : September 2, 2016 9:27 pm
sunshinefun
(@sunshinefun)
Trusted Member

Among other things, I operate a couple of AirBNB's here that make a good amount of income. I don't have a business license, don't pay tax on the earnings (but don't claim the expenses either) and haven't had a fire inspection. AirBNB transfers the funds directly to my bank account in the states. I know a few AirBNB operator's the do pay tax and such, but, they're the exception. The vast majority that I know don't.

That's ballsy - you publicly market and don't think anyone from local hotels will check and complain? Are you getting a 990?

Wow I thought if in any area, VI would be tight on the reins in the hospitality business.

Does your property insurer know you're in the short term rental business?

I meant 1099. AirBNB says it sends 1099's if you make more than $20K in a year. If that's the case IRS gets a copy as well if you have a stateside bank account. If each unit is a separate cost center I assume you're avoiding this consequence.

My guess is you're probably long-term leasing units and converting to AirBNB possibly without landlords knowing this.

Limited risk - with promise of a reasonable return. Quick exit.

Ingenious in kind of a smarmy unethical way.

Yes, you set them up as separate accounts with AirBNB so as long as you keep each one under 20K annual income, you're safe.

No, we don't lease long term units but I know several STX operators that do this, including savvy real estate agents who know their clients won't be around to check up on the units and are happy with what income they've been told their unit is producing which may or may not be the true figure.

As far as property insurance goes, we have a separate short term rental insurance policy written by a mainland insurer that I found in a Facebook ad. The local insurers don't seem to have caught on to this type of policy income stream yet but my guess is they'll be offering these policies soon.

Running an AirBNB or VIBO is not smarmy or unethical. Its a great way to make money, providing a service that is in demand.

I'm don't think the local hotels really care. I send my guests to their restaurants and facilities where they spend money. People who use AirBNB are not typically the "hotel" type of people anyway. I never stay in hotels anymore when I travel. Why would I? Every AirBNB I have ever stayed in is way better than a hotel and way cheaper. My units are deluxe and priced aggressively to compete. They're booked well into 2017.

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Posted : September 3, 2016 5:35 pm
caribstx
(@caribstx)
Trusted Member

There hundreds of Airbnb's in the VI now. The Airbnb site says 300+.

When governments don't keep up with technology and consumer demand, ie: allowing more hotel/resort development, the private sector always finds a way and takes over.

Now its too big to police.

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Posted : September 3, 2016 5:57 pm
Gator's Mom
(@gators_mom)
Trusted Member

Among other things, I operate a couple of AirBNB's here that make a good amount of income. I don't have a business license, don't pay tax on the earnings (but don't claim the expenses either) and haven't had a fire inspection. AirBNB transfers the funds directly to my bank account in the states. I know a few AirBNB operator's the do pay tax and such, but, they're the exception. The vast majority that I know don't.

That's ballsy - you publicly market and don't think anyone from local hotels will check and complain? Are you getting a 990?

Wow I thought if in any area, VI would be tight on the reins in the hospitality business.

Does your property insurer know you're in the short term rental business?

I meant 1099. AirBNB says it sends 1099's if you make more than $20K in a year. If that's the case IRS gets a copy as well if you have a stateside bank account. If each unit is a separate cost center I assume you're avoiding this consequence.

My guess is you're probably long-term leasing units and converting to AirBNB possibly without landlords knowing this.

Limited risk - with promise of a reasonable return. Quick exit.

Ingenious in kind of a smarmy unethical way.

Yes, you set them up as separate accounts with AirBNB so as long as you keep each one under 20K annual income, you're safe.

No, we don't lease long term units but I know several STX operators that do this, including savvy real estate agents who know their clients won't be around to check up on the units and are happy with what income they've been told their unit is producing which may or may not be the true figure.

As far as property insurance goes, we have a separate short term rental insurance policy written by a mainland insurer that I found in a Facebook ad. The local insurers don't seem to have caught on to this type of policy income stream yet but my guess is they'll be offering these policies soon.

Running an AirBNB or VIBO is not smarmy or unethical. Its a great way to make money, providing a service that is in demand.

I'm don't think the local hotels really care. I send my guests to their restaurants and facilities where they spend money. People who use AirBNB are not typically the "hotel" type of people anyway. I never stay in hotels anymore when I travel. Why would I? Every AirBNB I have ever stayed in is way better than a hotel and way cheaper. My units are deluxe and priced aggressively to compete. They're booked well into 2017.

It's only smarmy if owners aren't aware their property is being short-term rented.

Are you sure off-island insurance would hold up in court? I didn't think any policy would stand up to scrutiny unless approved through the Lt Gov's office. Insurance for short-term rentals is available in the VI. Why not use that?

Are you operating through an off-island LLC or corp?

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Posted : September 3, 2016 6:25 pm
sunshinefun
(@sunshinefun)
Trusted Member

It's only smarmy if owners aren't aware their property is being short-term rented.

Are you sure off-island insurance would hold up in court? I didn't think any policy would stand up to scrutiny unless approved through the Lt Gov's office. Insurance for short-term rentals is available in the VI. Why not use that?

Are you operating through an off-island LLC or corp?

I'm not sure why we even have short term rental insurance in the first place. If its available locally, we'd like to support local business. Who offers it?

We are neither an LLC nor a corporation.

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Posted : September 3, 2016 6:57 pm
Gator's Mom
(@gators_mom)
Trusted Member

It's only smarmy if owners aren't aware their property is being short-term rented.

Are you sure off-island insurance would hold up in court? I didn't think any policy would stand up to scrutiny unless approved through the Lt Gov's office. Insurance for short-term rentals is available in the VI. Why not use that?

Are you operating through an off-island LLC or corp?

I'm not sure why we even have short term rental insurance in the first place. If its available locally, we'd like to support local business. Who offers it?

We are neither an LLC nor a corporation.

I would talk to Marshall Sterling.

Risk is all about what you can or cannot afford to lose in case you're sued. Lot's of opportunity to be sued in the quasi hotel business. You're promising a perfect experience. What is someone is seriously injured on your premise?

Do you think AirBNB insurance will cover if the injury is at least partially caused by negligence on your part? Let's say a washer leak - someone slips and falls.

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Posted : September 3, 2016 7:14 pm
sunshinefun
(@sunshinefun)
Trusted Member

I would talk to Marshall Sterling.

Risk is all about what you can or cannot afford to lose in case you're sued. Lot's of opportunity to be sued in the quasi hotel business. You're promising a perfect experience. What is someone is seriously injured on your premise?

Do you think AirBNB insurance will cover if the injury is at least partially caused by negligence on your part? Let's say a washer leak - someone slips and falls.

True, but AirBNB has a review system. If a host gets sued or has an otherwise bad experience with a guest, they'll post that so future hosts know to decline that guest's request.

But I will check into M&S to see if they have the short term rental coverage

They didn't the last time I checked a year ago..

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Posted : September 3, 2016 8:02 pm
Gator's Mom
(@gators_mom)
Trusted Member

I would talk to Marshall Sterling.

Risk is all about what you can or cannot afford to lose in case you're sued. Lot's of opportunity to be sued in the quasi hotel business. You're promising a perfect experience. What is someone is seriously injured on your premise?

Do you think AirBNB insurance will cover if the injury is at least partially caused by negligence on your part? Let's say a washer leak - someone slips and falls.

True, but AirBNB has a review system. If a host gets sued or has an otherwise bad experience with a guest, they'll post that so future hosts know to decline that guest's request.

But I will check into M&S to see if they have the short term rental coverage

They didn't the last time I checked a year ago..

So if someone if injured on your property - AirBNB deems him/her a bad tenant?

You really need a business liability policy.

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Posted : September 3, 2016 9:20 pm
ms411
(@ms411)
Expert

"I'm don't think the local hotels really care. I send my guests to their restaurants and facilities where they spend money. People who use AirBNB are not typically the "hotel" type of people anyway. I never stay in hotels anymore when I travel. Why would I? Every AirBNB I have ever stayed in is way better than a hotel and way cheaper. My units are deluxe and priced aggressively to compete. They're booked well into 2017."

The hotels and Tourism are very concerned. The hotel tax goes to Tourism to promote the territory. The lower the occupancy the lower the money to advertise the territory. Many people believe that not all vacation rental owners are collecting and paying the hotel tax.

I quit using AirBnB over a year ago. Too time consuming to compare the pricing since now many charge a security deposit and cleaning fee.

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Posted : September 3, 2016 9:25 pm
Exit Zero
(@exit-zero)
Trusted Member Registered

If there was an accident on your property that involved a fire, I would like to see the Insurance Lawyers face when you show them your Fire Safety Certificate that cost $150 that does not include any kind of inspection.

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Posted : September 3, 2016 9:35 pm
Scubadoo
(@Scubadoo)
Trusted Member

My Lloyd's policy through Marshall Sterling has the option for rental rider. It doesn't differentiate between short term or long term as far as I recall..

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Posted : September 3, 2016 11:44 pm
Gator's Mom
(@gators_mom)
Trusted Member

My Lloyd's policy through Marshall Sterling has the option for rental rider. It doesn't differentiate between short term or long term as far as I recall..

Short-term rentals are a business and income is claimed on IRS Schedule C, long-term rental is passive income and claimed on IRS Schedule E. Short-term is inherently high risk, long-term is low risk.

(Sorry, some of us are familiar with tax forms. LOL)

I think you would need to look at how your insurance covers a home business - if the short-term is in your home.

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Posted : September 4, 2016 10:10 am
sunshinefun
(@sunshinefun)
Trusted Member

I'm really not the insurance type. I'm not the least bit concerned.

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Posted : September 4, 2016 1:26 pm
Scubadoo
(@Scubadoo)
Trusted Member

My Lloyd's policy through Marshall Sterling has the option for rental rider. It doesn't differentiate between short term or long term as far as I recall.

Now that I think about it when I asked my agent about it she knew I was asking about vacation rentals and not long term rentals, never discussed long term rentals.

Short-term rentals are a business and income is claimed on IRS Schedule C, long-term rental is passive income and claimed on IRS Schedule E.

That depends, if the owner uses the short-term rental property more than 14 days or more than 10% of the number of days it is rented -- whichever is greater -- it is considered a personal residence, not a business by the IRS.

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Posted : September 5, 2016 3:00 am
Gator's Mom
(@gators_mom)
Trusted Member

Either you deal with insurance and attorneys on the front end, or you deal with them on the back end with business dealings.

Lots of hungry lawyers in the VI happy to sue. It's an excellent way to lose your property but if you don't care ......

then enjoy it while you can and hope for the best.

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Posted : September 5, 2016 8:07 pm
sunshinefun
(@sunshinefun)
Trusted Member

Either you deal with insurance and attorneys on the front end, or you deal with them on the back end with business dealings.

You've been well trained to swallow all that conformity.

I tend to be a bit more rebellious.

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Posted : September 6, 2016 6:59 pm
Gator's Mom
(@gators_mom)
Trusted Member

Either you deal with insurance and attorneys on the front end, or you deal with them on the back end with business dealings.

You've been well trained to swallow all that conformity.

I tend to be a bit more rebellious.

been there done that bought that t-shirt.

all it takes is losing a lawsuit and responsibility for tens of thousands in legal fees,

property quickly gone. In VI.

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Posted : September 6, 2016 11:07 pm
Boston Janet
(@Boston_Janet)
Active Member

I run businesses in MA and have rental property as well. I claim all my income and insure against losses. I know of many people that work under the table and businesses that hire people under the table, don't have liability/worker's comp so they can beat the legitimate business' prices.
Sorry, not looking for a halo, but for starters, I don't want to live a dishonest life.
I also am not willing to risk everything that I have worked for with one bad incident.
As far as the OP not claiming any of the income, sorry, but I have no respect for you. You are taking as much as possible for yourself, but not paying taxes, which pays for our roads, schools, etc. Is our gov't, either in the states or here in the VI, perfect? Far from it. But part of the reason our taxes, insurance rates and health rates are so high is that we are paying for those that don't contribute their fair share.
So, "sunshinefun" if you choose to live your time here on this earth as a liar and a cheat, so be it. Laughable that you see yourself as "rebellious" when all you are is criminal. Karma always has a way of catching up with folks like you.

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Posted : March 19, 2017 1:04 pm
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