Indianapolis Short-Term Rental Regulations

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Permit & Licensing

Short-Term Rental Permit

This permit type does not require primary residence.

Application Process

Apply online through the Department of Business and Neighborhood Services Citizen Access Portal. Inspection may be required. Contact: 317.327.8700, 9AM-4PM Monday-Friday.

Tax Obligations

Combined rate: 17% of gross rental income.

Collection: Platforms (Airbnb, Vrbo) are required to collect and remit taxes on behalf of hosts. Hosts are liable if taxes are not collected.

Rental Limits

Indianapolis does not impose an annual cap on the number of nights you can rent.

Zoning & Restrictions

Permitted in legally built dwelling units meeting all applicable building code requirements. Allowed in primary buildings or conforming accessory buildings (secondary dwelling units). Prohibited in RVs, mobile homes, travel trailers, shipping containers, and non-permanent structures.

Insurance & Safety

Insurance

Indianapolis does not require short-term rental operators to carry specific insurance. Standard homeowner policies often exclude short-term rental activity, so many hosts obtain dedicated short-term rental or landlord liability coverage.

Safety & Operating Requirements

• Must meet all applicable building code requirements
• Must be in a legally built dwelling unit
• Inspection may be required as part of annual registration

Penalties for Non-Compliance

Maximum penalty: $500 per violation.

Compliance Checklist

Follow these steps to legally operate a short-term rental in Indianapolis:

1. Meet safety requirements. Must meet all applicable building code requirements. Must be in a legally built dwelling unit. Inspection may be required as part of annual registration.
2. Apply for Short-Term Rental Permit. Submit application + $150 fee.
3. Register for tax accounts. Set up lodging tax accounts with Indiana Department of Revenue.
4. Collect and remit taxes. 17% on all bookings.
5. Renew annually. $0 renewal fee.

Frequently Asked Questions

Do you need a permit to run an Airbnb in Indianapolis?

Yes. Operating a short-term rental — including an Airbnb or Vrbo — in Indianapolis requires a Short-Term Rental Permit.

How much does a short-term rental permit cost in Indianapolis?

A Short-Term Rental Permit in Indianapolis costs $150 per year.

Does Indianapolis require a short-term rental to be your primary residence?

No. Indianapolis allows non-owner-occupied short-term rentals, so investment properties can qualify provided you hold the required permit.

How many days a year can you short-term rent in Indianapolis?

Indianapolis does not cap the number of nights per year you can short-term rent, though permitting, zoning, and occupancy rules still apply.

What taxes do you pay on a short-term rental in Indianapolis?

Short-term rental stays in Indianapolis are subject to a combined 17% in lodging taxes. This combines 7% Indiana State Sales Tax + 10% Marion County Innkeeper's Tax. The host is responsible for collecting and remitting them.

What happens if you run a short-term rental without a permit in Indianapolis?

Operating without a permit can cost up to $500.