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Chris Kopf Coldwell Banker Mountain Properties

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Pillow Tax and Liability: Renting Your Mt. Crested Butte Home

July 20, 2015 By Chris Kopf

Pillow Tax and Liability: Renting Your Mt. Crested Butte Home

You may not have noticed the recent letter from the Town of Mt. Crested Butte regarding the responsibility you have to collect and remit the “Pillow Tax” and Sales Tax to the town of Mt. Crested Butte. The Pillow Tax is the license to do business in Mt. Crested Butte – it is a yearly fee of $10 per pillow. As an example if your home is advertised that it sleeps 10 then your annual tax is $100, if your home is advertised that it sleeps 15 then your annual tax is $150…etc.

Pillow Tax and Liability: Renting Your Mt. Crested Butte Home
Short Term Rental and Sales Tax
– whether you are renting via word of mouth, through a property management company, or through VRBO.com, Homeaway.com Airbnb.com…etc  you will also need to collect and pay sales tax of 13.5% and reporting those sales to:

  1. Town of Mt. Crested Butte
  2. Gunnison County
  3. Local Marketing District (also Gunnison County)
  4. State of Colorado

HELP – This can be a daunting collection, remittance and reporting nightmare –  If you need help setting all of this up – you can contact Tiffany O’Connell – Deputy Town Clerk at toconnell@mtcrestedbutte-co.gov or (970) 349-6632.

Mt. Crested Butte Town Website and Code for the above can be found in Chapter 11 and Chapter 19 – www.mtcrestedbuttecolorado.us for more info.

The Complete Guide to BUYING Your Mountain Dream HomeInsurance and Liability – Most standard homeowners insurance policies DO NOT cover short-term rentals. As well there is significant liability exposure if you do not protect you personal assets from a lawsuit if for example someone slips on ice on your property…etc As an excerpt from my book The Complete Guide to Buying Your Mountain Dream Home  – Quick and Easy Tips to Help You Purchase Your Vacation Home.

Insuring Your Vacation Home That Is Also a Rental Home
What if the maid service or the property manager does not lock the upstairs exterior door after the renters leave and the door blows open and a pipe freezes and breaks and 50,000 gallons of water flow through three levels of the house before the problem is detected a week later? If this happened as a result of renters and you did not have a policy covering that use, you may not be covered. Your insurance carrier will likely require you to install a security system that has water detection devices (“water bugs”) located under every sink, next to every toilet, and the water heater. A water main shut-off valve will be tied into the system so that if water is detected, the water main line will be turned off, preventing significant damage and sending an alert to the home monitoring service. Fire alarms and CO2 detectors are also required by most states, and will be a part of the home security system. Talk with your insurance company and ensure you have a policy that covers your vacation home and your rental home scenarios.

A regular homeowner’s policy and a vacation home policy may cover personal liability, but personal liability coverage or a personal umbrella policy will not cover business activities, such renting your second home. Personal liability is intended to cover you in the event that someone claims that you have caused them bodily injury, or damaged their property as a result of your personal actions. When you rent your home, you are a business and you need commercial liability coverage (business liability), which is specifically designed for “business activities” like your second home rental business. Liability coverage protects you if someone slips on an icy sidewalk and you are sued for damages. If there is severe damage to your second home and it cannot be rented, you may also want to ensure that your lost rental income is also covered.

Who Should “Own” Your Rental Home, You or an Entity?
What about the “renter slips on the ice” worst-case scenario, where you get personally sued for negligence and $1,000,000? Just like you need liability coverage to protect you, it is also recommended to separate your personal finances from your business liability. It is wise to contact an attorney to set up an entity that will shield your personal assets from a potential lawsuit from a renter. Anybody at any time can sue you; the lawsuit may be justified or frivolous, but you will likely need to hire an attorney to defend yourself. If you set up a Family Limited Partnership (FLP), Limited Liability Company (LLC) or a Corporation, you can separate your personal assets from being at risk. Talk with an attorney to ensure you are informed and protected.

How can I help you?  The Crested Butte area offers a wide variety of properties including ski in/ski out single family homes, ski-in/ski-out condominiums, lake and river frontage properties, golf course property, and true fine mountain homes on acreage. To see featured properties or search the MLS – visit www.ChrisKopf.com. If you considering Buying a Crested Butte home and are interested in finding out what properties may be a good fit for you and your family – call me. How is the Crested Butte Real Estate Market doing? Click this link to see my monthly Crested Butte Real Estate Market Reports I appreciate the opportunity to earn your business and be your Crested Butte Real Estate Agent.

Contact me at: (970) 209-5405, or ChrisKopf@BighornRealty.com

Thanks,

Chris Kopf
Previews® Property Specialist
Coldwell Banker Bighorn Realty

#1 Crested Butte Real Estate Agent
   in 2014 based on Total Volume

To see featured properties or search the MLS – visit www.chriskopf.com. Contact me at: (970) 209-5405, or chriskopf@bighornrealty.com

Thanks,
Chris.

Chris Kopf
Previews® Property Specialist
Coldwell Banker Bighorn Realty
(970) 209-5405
ChrisKopf@BighornRealty.com
www.ChrisKopf.com

Crested Butte CO real estate

 

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Chris Kopf, Coldwell Banker Mountain Properties
305 6th Street
Crested Butte, CO 81224
  • Chris.Kopf@CBMP.com
  • (970) 209-5405

Testimonials

Bobby Nichols

"The first moment we met Chris, my wife and I knew he was all about what is happening in real estate sales in Crested Butte. He knows his job, the marketplace and the innovative ways to market your home in today's electronic internet space. A real professional that understood us and our needs in handling a very successful sales transaction. "

 
Crested Butte Real Estate by Chris Kopf
2015-02-11T13:45:19-07:00
"The first moment we met Chris, my wife and I knew he was all about what is happening in real estate sales in Crested Butte. He knows his job, the marketplace and the innovative ways to market your home in today's electronic internet space. A real professional that understood us and our needs in handling a very successful sales transaction. "  
https://chriskopf.com/testimonials/bobby-nichols/

Jeff Hollings

Chris is outstanding! We recently bought a second home in Crested Butte and Chris did a great job throughout the whole process. He has a thorough understanding of the market and the benefits and drawbacks of various locations. He was very patient with us as our preferences evolved throughout the search. He gave us valuable information on which to negotiate the purchase. He had great follow-up during the inspection/closing process (when we were not in town) and made sure all of the commitments made by the seller were properly completed.
Crested Butte Real Estate by Chris Kopf
2015-02-11T13:46:48-07:00
Chris is outstanding! We recently bought a second home in Crested Butte and Chris did a great job throughout the whole process. He has a thorough understanding of the market and the benefits and drawbacks of various locations. He was very patient with us as our preferences evolved throughout the search. He gave us valuable information on which to negotiate the purchase. He had great follow-up during the inspection/closing process (when we were not in town) and made sure all of the commitments made by the seller were properly completed.
https://chriskopf.com/testimonials/jeff-hollings/

James Brennan

This was our first experience trying to purchase additional land with hopes of building a home. Chris was tremendously helpful throughout the entire process and his professionalism showed.
Crested Butte Real Estate by Chris Kopf
2014-10-14T17:59:24-06:00
This was our first experience trying to purchase additional land with hopes of building a home. Chris was tremendously helpful throughout the entire process and his professionalism showed.
https://chriskopf.com/testimonials/james-brennan/

Jane Saltzman

Chris was terrific to work with. The house sold faster then I ever expected! He was particularly helpful for this second home owner that couldn't always get there to take care of house issues. Thank you Chris!!!
Crested Butte Real Estate by Chris Kopf
2015-02-11T13:49:37-07:00
Chris was terrific to work with. The house sold faster then I ever expected! He was particularly helpful for this second home owner that couldn't always get there to take care of house issues. Thank you Chris!!!
https://chriskopf.com/testimonials/jane-saltzman/

Georges Lussier

The thought of a short sale was intimidating, but Chris made the experience very easy with lots of guidance from start to finish. I would highly recommend Chris for any Real Estate need buying or selling.
Crested Butte Real Estate by Chris Kopf
2014-10-14T18:05:40-06:00
The thought of a short sale was intimidating, but Chris made the experience very easy with lots of guidance from start to finish. I would highly recommend Chris for any Real Estate need buying or selling.
https://chriskopf.com/testimonials/georges-lussier/

Frank Stringer

Chris Kopf is a wonderful person to work with on any real estate matter you may have in Crested Butte. He is extremely knowledgeable of all elements of the Crested Butte area. He helped us recently to buy a new second home in Skyland and the entire experience was first class under Chris's guidance. I would highly recommend him to anyone who has a real estate need in Crested Butte.
Crested Butte Real Estate by Chris Kopf
2015-02-11T13:51:04-07:00
Chris Kopf is a wonderful person to work with on any real estate matter you may have in Crested Butte. He is extremely knowledgeable of all elements of the Crested Butte area. He helped us recently to buy a new second home in Skyland and the entire experience was first class under Chris's guidance. I would highly recommend him to anyone who has a real estate need in Crested Butte.
https://chriskopf.com/testimonials/frank-stringer/

Paul & Julie Keesee

Chris was quite helpful in showing us homes in the area we were interested in and contacted us when new listings were available. We not only consider him our realtor but also a friend.
Crested Butte Real Estate by Chris Kopf
2014-10-14T18:05:59-06:00
Chris was quite helpful in showing us homes in the area we were interested in and contacted us when new listings were available. We not only consider him our realtor but also a friend.
https://chriskopf.com/testimonials/paul-julie-keesee/

Jim & Sandra Wickham

Chris' patience and persistence paid off for us in finding the right house for the right price. We would highly recommend Chris to any potential buyer.
Crested Butte Real Estate by Chris Kopf
2014-10-14T18:06:18-06:00
Chris' patience and persistence paid off for us in finding the right house for the right price. We would highly recommend Chris to any potential buyer.
https://chriskopf.com/testimonials/jim-sandra-wickham/

Tom & Mary Aton

It was a great experience working with Chris, after showing me what I thought I wanted, he advised me of the pros and cons on the different condos and found one that I am thrilled with.
Crested Butte Real Estate by Chris Kopf
2014-10-14T18:06:31-06:00
It was a great experience working with Chris, after showing me what I thought I wanted, he advised me of the pros and cons on the different condos and found one that I am thrilled with.
https://chriskopf.com/testimonials/tom-mary-aton/

Dan Aquaviva

This agent has a very strong knowledge of the local area. He was very helpful in screening properties for potential purchase.
Crested Butte Real Estate by Chris Kopf
2014-10-14T18:05:26-06:00
This agent has a very strong knowledge of the local area. He was very helpful in screening properties for potential purchase.
https://chriskopf.com/testimonials/dan-aquaviva/
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Crested Butte Real Estate by Chris Kopf

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