Short-term rental rules · Farragut, Tennessee
Short-term rentals in Farragut, explained properly.
The Town of Farragut's zoning ordinance prohibits short-term rental units in all zoning districts. The one exception in Section X covers short term rentals the Town recognized as legally operating before May 17, 2018, which are afforded the protections of Tennessee Code Annotated 13-7-603(a). Tennessee's sales tax and local occupancy tax rules apply to stays as described in the state section of this page.
At a glance
What you need to know before you buy or list
| Question | Answer |
|---|---|
| Are short-term rentals allowed? | No: prohibited in all zoning districts of the Town, except rentals the Town recognized as legally operating before May 17, 2018[1]ClauseClauseClause |
| Are rentals the Town recognized as legally operating before May 17, 2018 protected? | Yes: they are afforded the protections of, and are subject to, T.C.A. 13-7-603(a)[1]ClauseClauseConfirming |
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Detailed rules
The full picture, section by section
State law that also applies
| State and local sales tax on short stays | 7% state sales tax plus the local sales tax rate (1.5% to 2.75%), both paid to the Tennessee Department of Revenue[2]ClauseClauseClause Renting a home, cabin, condominium or room for lodging is subject to Tennessee's 7% state sales tax and the local sales tax rate where the rental is located. The Tennessee Department of Revenue administers both. Sales tax is charged on the full price of the stay, including required fees such as cleaning and booking fees. |
|---|---|
| Which stays are taxed? | Sales tax: stays of less than 90 continuous days. Local occupancy taxes: short-term rental units rented for 30 days or less[2]ClauseClause Tennessee sales tax does not apply to a room or home rented to the same person for 90 or more continuous days. Local occupancy taxes apply only to short-term rental units rented for 30 days or less and stop applying on day 31; for rental agreements made, renewed or amended on or after July 1, 2025, occupancy tax collected on days 1 to 30 is not refunded. |
| Tennessee sales tax registration required? | Yes if you take bookings directly; not for bookings made through a platform that collects the tax[2]ClauseClauseClause The Tennessee Department of Revenue says property owners and property management companies with over $100 a month in taxable sales must register with the Department and collect and remit sales tax. If you list only through an online platform that is a marketplace facilitator, the platform collects and remits sales tax on those bookings and you should keep records showing the rentals went through it. Bookings you take directly, outside a platform, are your responsibility. |
| Do booking platforms collect taxes? | Yes: platforms collect sales tax and local occupancy taxes on bookings made through them[2]ClauseClauseClause Online platforms that are marketplace facilitators collect and remit Tennessee sales tax on bookings made through them. Since January 1, 2021, short-term rental platforms have also collected local occupancy taxes on their bookings and paid them to the Department of Revenue, so the owner does not collect local occupancy tax on those bookings. |
| Local occupancy (hotel) taxes | Set by cities and counties; for bookings you take directly, paid to the local government[2]ClauseClauseClause Many Tennessee cities and counties charge their own occupancy tax on short-term rental stays. For bookings you take yourself (not through a platform), you collect it and pay it directly to the local government where the rental is, not to the state. The Department of Revenue advises every owner, including those who rent only through platforms, to contact the local officials, because there may be local reports or requirements. |
Changes
Recent and pending changes
We read Section X (Short term rental units) of the Town of Farragut zoning ordinance, Appendix A, Chapter 4, as published on Municode and fetched on October 15, 2026. We did not read the Chapter 2 definitions, T.C.A. 13-7-601 through 606, or Board of Mayor and Aldermen or Planning Commission agendas, so we will watch the Town's code and agendas for changes.
Sources
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This page is general information compiled from public sources, not legal or tax advice. HOA rules, deed restrictions and zoning for a specific property can be stricter. Confirm with the local permitting office and a qualified professional before buying or listing a property.