Waco Short-Term Rental Regulations

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Permit & Licensing

Bed and Breakfast Facility or Short-Term Rental Facility License, covering five categories: Bed & Breakfast Homestay…

This permit type does not require primary residence.

Application Process

Submit an online license application (via Citizen Self Service) with a scaled site plan and non-refundable license fee to the Planning/Development Services department, obtain any required Special Permit first, and pass a Life Safety Inspection (or provide a certificate of occupancy issued within the last 12 months). The license is valid for two years and may be renewed.

Tax Obligations

Combined rate: 15% of gross rental income.

Collection: City and county Hotel Occupancy Tax is filed and paid online through Neumo (formerly Avenu Insights) at revds.com, due monthly by the 20th; the state 6% portion is registered and paid separately and directly with the Texas Comptroller of Public Accounts.

Rental Limits

Waco does not impose an annual cap on the number of nights you can rent. Each individual stay must be less than 30 consecutive days.

Occupancy & Density Limits

Maximum 2 adults per bedroom plus 2 additional adults per rental unit citywide; in R-E, R-1A, R-1B, and R-1C zoning districts, a Bed & Breakfast Homestay Establishment, STR Type I, or STR Type II may not be occupied by more than 4 individuals unrelated by blood, marriage, or adoption at any given time.

Zoning & Restrictions

• In R-E, R-1A, R-1B, R-1C, and R-2 zoning districts, a Bed & Breakfast Homestay Establishment or STR Type II may not be located within 500 feet of another licensed BBHE or STR Type II.
• STR Type I and BBHE require a Special Permit in R-E, R-1A, R-1B, and R-1C;
• STR Type II is no longer allowed by special permit in those districts (effective June 15, 2021), and STR Type III is no longer allowed by special permit in R-3A-E, O-2, O-3, and C-1 (effective June 15, 2021).
• STR Type III properties are capped at 5 units per property, with a narrow exemption for individually-owned condo units in the Downtown District Overlay/C-4 zoning meeting association-disclosure conditions.

Insurance & Safety

Insurance

Waco 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 pass a Life Safety Inspection (or provide a certificate of occupancy issued within the last 12 months) covering smoke detectors, at least one operable egress window per bedroom, a posted evacuation plan in each sleeping area, repair of exposed wiring, water heater inspection, required pool safety measures (if applicable), and exterior stairwells (if applicable).

Penalties for Non-Compliance

The Director of Planning Services may immediately revoke or suspend an STR license, or deny issuance/renewal, for violation of the ordinance or license conditions, violation of federal/state/city law, a determination by police/fire chiefs that the facility poses a serious threat to public health/safety/welfare, or a false statement of material fact on the application. Failure to collect the Hotel Occupancy Tax, or filing no report or a false report, is a misdemeanor under city ordinance; delinquent tax forfeits an additional 5% penalty (plus another 5% after 30 days) and accrues 10% annual interest beginning 60 days after the due date. A $500 Non-Compliance Fee also applies to STR licenses ($250 for a non-compliant renewal).

Compliance Checklist

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

1. Meet safety requirements. Must pass a Life Safety Inspection (or provide a certificate of occupancy issued within the last 12 months) covering smoke detectors, at least one operable egress window per bedroom, a posted evacuation plan in each sleeping area, repair of exposed wiring, water heater inspection, required pool safety measures (if applicable), and exterior stairwells (if applicable).
2. Apply for Bed and Breakfast Facility or Short-Term Rental Facility License, covering five categories: Bed… Submit application + $500 fee.
3. Register for tax accounts. Set up lodging tax accounts with City of Waco Fiscal Management Services and McLennan County; Texas Comptroller of Public Accounts.
4. Collect and remit taxes. 15% on all bookings.
5. Renew every 2 years. $250 renewal fee.

Frequently Asked Questions

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

Yes. Operating a short-term rental — including an Airbnb or Vrbo — in Waco requires a short-term rental permit.

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

A short-term rental permit in Waco costs $500. Renewal is $250.

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

No. Waco 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 Waco?

Waco 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 Waco?

Short-term rental stays in Waco are subject to a combined 15% in lodging taxes. This combines 6% State of Texas Hotel Occupancy Tax + 7% City of Waco Hotel Occupancy Tax + 2% McLennan County Hotel Occupancy Tax. Hosts are legally responsible; many booking platforms collect and remit them automatically on the host's behalf.

What are the penalties for short-term rental violations in Waco?

Penalties run up to $500 (STR license Non-Compliance Fee).