Compliance · 2026
Minneapolis license rules, fees and the lodging-tax stack
The rule that shapes every Minneapolis purchase is the ownership cap. The city's short-term rental page, last updated in July 2026, lets an owner operate one short-term rental property besides their own home, and the count includes LLCs, even for people who hold several of them. Titling a second unit in a new company won't get it licensed, and if you already run a short-term rental anywhere in the city, you've used your slot. The definition is plain: a stay of 30 days or less needs a short-term rental license, and anything longer runs on the city's regular rental license. That leaves three realistic plays. You can rent part or all of the home you live in, license one investment unit, or buy a duplex or triplex, live in one unit and license another. Decide which of those owners you are before you shop, because the answer sets the property type, the loan and the paperwork that follow.
Which license you need, and the limits that come with it
The city sorts hosts by where they sleep. Rent a spare room while you stay in the house and you need no license, though the listing should say the space is exempt. Rent out your whole homestead unit or condo and you need a short-term rental license, with the license number on every platform listing, occupancy capped at 10 and the city's short-term rental information posted inside the unit. A non-homestead unit carries the same license, the same 10-guest ceiling and the same listing-number rule, plus a management plan and a floor plan filed with the city. Building size adds a second test. Where a building has 20 or more units, only 10% of them may run as short-term rentals, and the city says that percentage doesn't apply to condo buildings. In a condo, the association's declaration and rules are the gate that matters, since an association can set a minimum stay or bar short-term rentals entirely. Read them before you write an offer, and ask the city whether the unit you want already holds a license.
Fees, inspections and what happens when a property sells
Budget for two money lines, the license and the inspections around it. The city's rental fee page, updated in August 2026, puts an annual license on a one-to-three-unit building at about $98 plus $41 a unit in Tier 1, $105 plus $75 a unit in Tier 2 and $121 plus $190 a unit in Tier 3. That schedule hits duplex owners directly, because the city allows only one non-homestead short-term license and every other unit in the building needs a regular rental license. Any unit that becomes a rental triggers a conversion inspection, recently listed at $1,000. Renewals are due March 1, with a 25% late fee after March 15, and a license first taken out between Sept. 1 and Feb. 28 is prorated by 50%. A sale doesn't hand you the seller's standing either. The buyer has 60 days from closing to apply for a rental license, after which the city charges an administrative fee of $250 for the first unit plus $20 for each additional one, and some properties also need a change-of-ownership inspection, recently $450. The one-property cap is then counted against you as the new owner, whatever the seller held. Treat these as recent fee schedules and confirm the current figure with the city before you budget.
The tax stack, and who files it
Short stays here are taxed like hotel rooms. Minnesota's 6.875% state sales tax applies to short stays, and the combined general sales tax in Minneapolis in 2026 is 9.025%, made up of the state rate plus 0.15% for Hennepin County, a 0.5% Hennepin transit tax, the city's own 0.5%, and the metro-area housing and transportation taxes of 0.25% and 0.75%. On top of that, the Minnesota Department of Revenue administers a set of Minneapolis special taxes, among them a lodging tax and an entertainment tax, so a city stay can carry more than the general rate. Airbnb says it collects and remits the 6.875% state tax plus local sales and special taxes it lists at 0.5% to 3.0% on Minnesota reservations of 29 nights or fewer, cleaning fees included, and it leaves every other tax obligation with you. Direct bookings from your own website get no platform help. You register with the Department of Revenue, charge the full stack and file the returns yourself. None of this is tax advice for your situation, so have an accountant who files Minneapolis lodging returns confirm which special taxes reach your unit before your first direct guest arrives.