By Dennis. Published . Updated .
Sevierville Airbnb operations inside City limits require an annual operational permit and a Fire Department life-safety inspection. The City’s 3% lodging tax and Tennessee sales tax apply through separate filing rules, with a distinct marketplace collection mechanism.
Find My Sevierville Airbnb InvestmentCity of Sevierville permits apply to rentals within its municipal limits.
The City Limits Verification Map establishes the City program’s coverage. Properties with a Sevierville mailing address in unincorporated Sevier County follow the County program. The City application begins under Planning and Zoning, tying the proposed rental to the exact address and lawful dwelling.
The operational permit combines documentation, fee payment and a life-safety inspection.
Submit through MGO Connect after selecting Tennessee and Sevierville, then Planning and Zoning and Short-term Rental. The application identifies the address, contacts and supporting documents. Upload an aerial or site plan showing sufficient off-street parking, proof of fire, hazard and liability insurance with at least $1 million per occurrence, and a floor plan showing every bed, including pull-out couches, futons and bunks. Supply the certificate of occupancy and hospitality-tax application or payment proof where applicable. A nonowner applicant supplies the owner’s notarized permission letter. The questionnaire identifies interior work and operation in good standing before August 21, 2021; that prior-operation claim requires hospitality-tax proof in the Files upload. The Fire Department issues the permit after the applicable review and inspection steps. The City’s operational-permit guide lists a $50 application fee and a $200 annual permit fee. Permits last one year and require a new application each year. Renewal includes current insurance proof.
Post the full Short-Term Rental Operational Permit directly inside the main entrance and the condensed form directly outside the main entrance.
City inspection guidance requires interconnected smoke alarms on every level and in sleeping areas.
Each level needs an annually inspected and tagged extinguisher rated at least 2A:10BC with five pounds of agent. Sleeping areas need an operable outside window or door. The listed window opening is 5.7 square feet, at least 20 inches wide and 24 inches high, and at most 44 inches above the floor. Rentals sleeping more than 12 people require sprinklers under the City checklist; other building factors can also trigger sprinklers. Extension cords are temporary for at most 90 days, visible, unattached to structures and protected from physical damage. Kitchen appliances and heaters plug directly into outlets. Multi-plug adapters for household electronics and lights require surge or over-current protection and a direct outlet connection.
Approved sleeping capacity and physical safety features define the rental’s operating layout.
Keep permitted plans, insurance documentation, inspection findings and the annual operational permit with the address record. The visible street number must be at least four inches tall and readable from the street. Advertised beds and sleeping capacity should follow the approved dwelling and inspection outcome.
City guidance lists 3% lodging tax for transient stays shorter than 30 days and 9.75% sales tax.
Hypothetical tax example: $1,000 taxable receipts subject to both layers produces $30 City lodging tax and $97.50 sales tax, totaling $127.50. Tennessee sales tax applies to lodging shorter than 90 continuous days and includes mandatory rental charges such as cleaning and nonrefundable pet fees. City hospitality returns use STEP. The marketplace occupancy-tax rules assign collection on qualifying marketplace bookings to the marketplace; direct-booking obligations remain with the provider.
Obtain the City Certificate of Zoning Compliance before submitting Apply for New Business to File Hospitality Taxes. After account setup, file current and prior City periods through STEP/CSS. For owner-collected direct-booking sales tax, register through Tennessee Taxpayer Access Point (TNTAP) using Register a New Business, then file and pay the monthly sales-and-use-tax return in the sales-tax account. The return and payment are due the twentieth of the following month, with the next business day applying when the deadline falls on a weekend or legal holiday. A registered account files for a no-sales month with Line 1 gross sales of $0. Qualifying marketplaces remit their booking taxes; owners’ direct-booking local occupancy-tax registration and payments remain with the local jurisdiction.
City lodging returns and payment are due on the twentieth of each month for the previous month, including months with no sales or business income. In STEP/CSS, select Sevierville Tax Remittance, choose File Now beside the business, enter gross and exempt amounts for the lodging period, and use Report Zero for zero activity. Review and submit the return, then choose Add To Cart to pay by credit card.
For a check payment, print the filed statement and send it with payment to City of Sevierville Taxes, P.O. Box 5500, Sevierville, TN 37864-5500, or deliver it to City Hall. The return itself is filed online. USPS postmarks receive consideration for mailed payments. Attach exemption documents for exempt amounts and preserve tax records for at least three years.
Tennessee distinguishes rental sales tax, local occupancy tax and business taxes.
The State manual says individual vacation-lodging owners generally owe business tax at $100,000 or more in annual taxable gross sales in a jurisdiction. Use of a property-management company changes the business-tax taxpayer to that company for managed overnight receipts. Entity structures can create franchise and excise obligations. Applicable business-tax returns and payment are due on the fifteenth day of the fourth month after the taxpayer’s fiscal year ends, with a consolidated return for multiple properties. Individuals are exempt from franchise and excise tax. A taxable limited-liability rental entity registers in TNTAP within 15 days after becoming subject to that tax, without a registration fee, and reports annually on Form FAE170 for its federal accounting period. Qualifying obligated-member or family-owned noncorporate entities claim their exemption with Form FAE183 for the initial and each subsequent taxable period. Entity status and management arrangements determine these obligations. Booking channel, gross receipts, exemptions and marketplace statements support the correct filings.
City inspection controls outdoor fire devices, gas appliances and hot-tub electrical safety.
Gas cooking devices and fire pits require fire-inspector approval. Approved fire pits need an extinguishing means such as a water hose or fire extinguisher. Charcoal grills stay at least ten feet from combustible materials. Hot tubs require a labeled disconnect within sight and at least five feet away. Unvented gas fireplaces over 10,000 BTUs are barred from sleeping areas. FEMA flood mapping and address-specific inspections support flood, drainage, access and insurance budgeting.
A purchase decision requires lawful booking capacity and a property-specific operating budget.
Occupancy above 12 people triggers the listed sprinkler requirement, and the City inspection regulates exits, grills, fire pits and hot-tub electrical equipment. Budget the operational permit, insurance, alarm interconnection, annual extinguisher service, any required sprinkler work, furnishings, utilities, cleaning and financing. Actual property and contractor quotes determine the dollar costs.
Hypothetical annual underwriting example: $60,000 in rental revenue minus $30,000 operating expenses gives $30,000 net operating income. Subtract $20,000 debt service and $3,000 capital reserves for $7,000 cash flow before income tax. On $100,000 invested cash, cash-on-cash return is 7%. A $500,000 purchase price gives a 6% cap rate before debt and capital reserves. All example amounts are hypothetical calculation inputs.
Invested cash includes the down payment, closing costs, initial repairs, furnishing and startup reserves. Separate guest-collected lodging taxes from owner revenue. Property-level booking history and actual quotes support a base case and a lower-receipt, higher-expense scenario.
Local government and tax agencies administer legal approvals and tax accounts.
Fire Prevention administers STR permit and inspection decisions. Code Enforcement receives property-code reports through the City’s published reporting channel, and Police dispatch handles active nonemergency disturbances. Emergencies require 911.
STR Search provides property-selection and setup support. Book Sevierville STR property-selection and setup support. The local jurisdiction remains the authority for legal eligibility and permit approval.
Government requirements determine rental eligibility, registration, taxes and safe operation.
Establish City jurisdiction and legal dwelling use, submit the MGO Connect application, provide current insurance and pass the life-safety inspection before operation.
Select properties with a lawful dwelling, inspection-compatible sleeping capacity, usable guest access, safe amenities and adequate parking. The City boundary and individual flood and drainage exposure form part of address comparison.
Use MGO Connect for Tennessee, Sevierville, Planning and Zoning, and Short-term Rental. The operational permit requires documentation and Fire inspection. The application uploads an aerial or site plan showing off-street parking, fire/hazard/liability insurance proof for at least $1 million per occurrence, and a floor plan locating all beds, including sofa beds, futons and bunks. Include the certificate of occupancy and hospitality-tax application or payment proof where applicable, and the owner’s notarized rental permission for a nonowner applicant. Identify proposed interior work; a claim of qualifying operation before August 21, 2021 requires hospitality-tax proof. The City guide lists a $50 application fee and a $200 annual permit fee. Permits last one year and require a new application each year, with current insurance for renewal.
Post the full Short-Term Rental Operational Permit directly inside the main entrance and the condensed form directly outside the main entrance.
The City program applies inside Sevierville limits. Approved sleeping areas, egress, alarms, insurance and sprinkler requirements control the permitted rental configuration. Unincorporated Sevier County has its own program.
The City boundary determines whether Sevierville’s operational permit applies; unincorporated Sevier County follows a separate program. Parcel-level flood mapping, drainage, emergency access and insurance costs affect the usable rental calendar and reserve budget.
City guidance lists 3% lodging tax for stays under 30 days and 9.75% sales tax. A hypothetical $1,000 taxable booking under both layers produces $127.50. Qualified marketplaces collect occupancy tax on their bookings; direct bookings require provider collection and appropriate filings. Business tax generally applies to an individual vacation-lodging owner at $100,000 or more annual taxable gross sales in a jurisdiction; a property-management company becomes the business-tax taxpayer for managed overnight receipts. Applicable business-tax returns and payment are due the fifteenth day of the fourth month after fiscal year-end. Individuals are exempt from franchise and excise tax. Taxable rental entities register in TNTAP within 15 days of becoming liable and file annual FAE170 returns. Qualifying obligated-member or family-owned noncorporate entities file FAE183 for the initial and annual exemption periods.
Obtain the City Certificate of Zoning Compliance before submitting Apply for New Business to File Hospitality Taxes. After account setup, file current and prior City periods through STEP/CSS. For owner-collected direct-booking sales tax, register through Tennessee Taxpayer Access Point (TNTAP) using Register a New Business, then file and pay the monthly sales-and-use-tax return in the sales-tax account. The return and payment are due the twentieth of the following month, with the next business day applying when the deadline falls on a weekend or legal holiday. A registered account files for a no-sales month with Line 1 gross sales of $0. Qualifying marketplaces remit their booking taxes; owners’ direct-booking local occupancy-tax registration and payments remain with the local jurisdiction.
City lodging returns and payment are due on the twentieth of each month for the previous month, including months with no sales or business income. In STEP/CSS, select Sevierville Tax Remittance, choose File Now beside the business, enter gross and exempt amounts for the lodging period, and use Report Zero for zero activity. Review and submit the return, then choose Add To Cart to pay by credit card.
For a check payment, print the filed statement and send it with payment to City of Sevierville Taxes, P.O. Box 5500, Sevierville, TN 37864-5500, or deliver it to City Hall. The return itself is filed online. USPS postmarks receive consideration for mailed payments. Attach exemption documents for exempt amounts and preserve tax records for at least three years.
Budget the operational permit, insurance, alarm interconnection, annual extinguisher service, any required sprinkler work, furnishings, utilities, cleaning and financing. Actual property and contractor quotes determine the dollar costs.
Profitability depends on lawful booking capacity and the property’s actual receipts, operating costs, reserves and debt payments. Required safety work and lawful sleeping capacity affect the operating budget. Hypothetical annual example: $60,000 rental revenue minus $30,000 operating expenses produces $30,000 net operating income. After $20,000 debt service and $3,000 capital reserves, cash flow is $7,000 before income tax. These assumed dollars illustrate the calculation.
Cash-on-cash return equals annual cash flow divided by invested cash; capitalization rate equals net operating income divided by purchase price. Hypothetical example: $7,000 annual cash flow divided by $100,000 invested cash is 7%. A $30,000 net operating income divided by a $500,000 purchase price is a 6% cap rate. Acquisition, furnishing and reserve cash belong in invested cash. All figures in this example are assumed inputs.
The responsible local office handles eligibility, applications, renewals and administrative decisions; the appropriate tax agency handles tax accounts and returns. STR Search offers help identifying, selecting and setting up a short-term rental. The local jurisdiction remains the authority for legal eligibility and permit approval. Sevierville Fire Department: fireinspectors@seviervilletn.org, 865-868-1585.
Inside Sevierville city limits, the annual operational permit requires a new application, current insurance and the applicable life-safety review. Budget the $50 application and $200 annual permit fees together with alarms, exits, extinguisher servicing and any required sprinkler work; post the full permit inside the main entrance and the condensed version outside. The permitted sleeping capacity and separate City lodging and Tennessee sales-tax duties belong in the property’s cash-flow model before acquisition.
