Short-term rental rules · Montgomery County, Maryland
Short-term rentals in Montgomery County, explained properly.
Montgomery County, Maryland requires a County license from the Department of Housing and Community Affairs for any short-term residential rental or bed and breakfast, renewed every year. The operator must certify that the home is their primary residence, that guests are limited to 6 adults and 2 adults per bedroom, and that the HOA, condominium or lease does not prohibit it. The County license does not apply inside municipalities such as Rockville and Gaithersburg. The license fee is unsettled: the County's FAQ says $500 but its fee regulation says fees are set in the annual budget. We haven't reviewed the zoning rules yet, so confirm zoning before you buy.
At a glance
What you need to know before you buy or list
| Question | Answer |
|---|---|
| Are short-term rentals allowed? | Conditional: allowed only with a County license from the Department of Housing and Community Affairs, and only in the operator's primary residence; we haven't reviewed the zoning rules, so confirm zoning before you buy [1] ClauseConfirming |
| Is a County license required for a short-term rental? | Yes: a bed and breakfast or short-term residential rental license from the DHCA Director, renewed once a year. Excluded: rentals inside the listed municipalities such as Rockville and Gaithersburg [1] [2] Clause 1 Clause 2 |
| Must the operator live at the rental as their primary residence? | Yes: the applicant must certify the rental is their primary residence and that they are the owner or the owner's authorized agent [1] [3] Clause 1 Clause 2 |
| Is there a limit on overnight guests in a short-term rental? | Yes: no more than 6 overnight guests aged 18 or older in total, and no more than 2 guests aged over 18 per bedroom [1] Clause |
| Can an accessory dwelling unit be used as a short-term rental? | No: the DHCA FAQ says an accessory dwelling unit is not a short-term residential rental and cannot be operated as one [2] [3] Clause 1 Clause 2Confirming |
| What is the County license fee? | Needs review: the DHCA FAQ says $500 a year for a short-term residential rental and $150 for a bed and breakfast, but Executive Regulation 2-25 shows $150 for both and says fees are set each year in the County budget by resolution [4] [2] [5] Clause 1 Clause 2 Clause 3Confirming |
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Detailed rules
The full picture, section by section
Operating rules
| Does the license depend on HOA, condominium or lease rules? | Yes: the applicant must certify the application is not prohibited by any homeowners association or condominium document or a rental lease, and that common ownership community fees are no more than 30 days past due [1] Clause Both are certifications in Sec. 54-43(n) and (o). The DHCA FAQ repeats that an application may only be submitted if the HOA, condominium document or lease does not prohibit it. |
|---|---|
| Must neighbors be notified? | Yes, where applicable: abutting and confronting neighbors (single-unit or attached homes) or neighbors across the hall and sharing a ceiling, floor or wall (multi-unit buildings), plus the municipality, any HOA or condominium, and the owner if the applicant is an agent [1] Clause The applicant certifies the notices under Sec. 54-43(m). Within 30 days after an application is filed, a resident or owner within 300 feet, the municipality, an HOA or condominium, or the owner may file a challenge (Sec. 54-46); the Director then has 60 days to decide after receiving it. |
| Is a designated representative required? | Yes: a designated representative who lives within 15 miles of the unit and is reachable for the whole contract whenever the primary resident is not present [1] Clause The applicant also posts rules and the representative's emergency contact information inside the rental (Sec. 54-43(i), (k)). |
| Are safety items certified on the application? | Yes: smoke detectors in all units and carbon monoxide detectors in units using natural gas must operate as designed, and sanitation facilities must operate as designed [1] Clause The Director may inspect the property (Sec. 54-45(b)). |
| Are guest records and a license number in listings required? | Yes: keep a record of all overnight visitors available for inspection, and any online listing must include the license number [1] Clause Executive Regulation 27-25 lists what the record must contain (name, home address, age, room and check-in and check-out times of each overnight visitor); the copy we saved shows no effective date for it. |
| How long does approval take? | The Director approves or denies a completed application no earlier than 30 and no later than 60 days after receipt, unless a neighbor challenge is filed [1] Clause If a challenge is filed under Sec. 54-46, the Director has 60 days after receiving it to decide. |
Penalties & enforcement
| Can a license be suspended or revoked? | Yes: the Director may suspend or revoke for a violation of Chapter 54 or other law, a listed state criminal conviction, or repeated dangerous or nuisance operation; after revocation no license for 3 years to the former licensee, household members or the same dwelling unit [1] Clause A person aggrieved by issuance, renewal, denial, suspension or revocation may appeal to the Board of Appeals within 30 days (Sec. 54-48). The Director may require the licensee to show cause first (Sec. 54-47(b)). We haven't reviewed the civil-penalty sections the DHCA page cites (Sec. 54-13 and Chapter 1, Sec. 1-19), so fine amounts are not shown. |
|---|
State law that also applies
| Maryland state sales tax on short-term rentals | 6% Maryland sales and use tax: the Tax-General Article counts a short-term rental (the temporary use of a home or part of one to lodge transient guests for pay) as taxable tangible personal property, taxed at 6 cents on each dollar [6] [7] [8] Clause 1 Clause 2 Clause 3 Section 11-101 of the Tax-General Article defines a short-term rental as the temporary use of a short-term rental unit (a residential dwelling unit or part of one, including a house, apartment, condominium or cooperative) to provide accommodation to transient guests for lodging purposes in exchange for consideration, and lists both an accommodation (a right to occupy a room or lodgings as a transient guest) and a short-term rental as tangible personal property. Section 11-104(a) sets the general sales and use tax rate at 6 cents for each exact dollar of the taxable price. The Comptroller of Maryland's 2016 tax alert on accommodations says that individuals who rent out their homes or rooms are accommodations providers who must register with the Comptroller and collect the tax, that the tax does not apply to monthly or permanent residents, and that all rentals in resort areas for terms of 4 months or less are subject to the tax. Local room or hotel taxes are shown on each place's page. |
|---|---|
| Do booking platforms collect the state sales tax? | Yes: Maryland law makes a short-term rental platform a vendor, counts bookings made through it as sales, and requires vendors to collect the sales and use tax from the guest; tax is due on the full amount the guest pays, not counting other taxes remitted [6] [9] [8] Clause 1 Clause 2 Clause 3 Section 11-101 defines a short-term rental platform as an Internet-based digital entity that advertises short-term rental units and is paid for facilitating reservations or processing booking transactions for the owner, operator or manager, and lists a short-term rental platform as a vendor. Section 11-403(a)(5) says sales include a booking transaction made through a short-term rental platform, and 11-403(b) requires a vendor to collect the sales and use tax from the buyer. Under 11-101(l)(5), when a platform facilitates a stay, the taxable price is the full amount the guest pays, not counting any tax remitted to a taxing authority; a commission paid by the host after the booking is not included. The Comptroller's 2016 alert says hosting platforms that collect payments on behalf of an owner must register and collect the tax, and that an owner's duty to collect is waived only when the platform gives the owner a resale certificate. A 2025 law (Chapter 638) rewrites these definitions from July 1, 2027 so that an accommodations intermediary includes a short-term rental platform. The sources read do not say whether a host who books through a platform that collects must still file returns; check with the Comptroller. |
| Statewide short-term rental law? | Yes, a statewide safety law (in effect since October 1, 2026): hosts of rentals offered for less than 30 consecutive days must post an evacuation diagram and emergency numbers and provide a working fire extinguisher, smoke alarms and carbon monoxide alarms; booking services must tell hosts about these rules. There is no statewide short-term rental license, ban or cap, and the law does not limit local rules [10] [11] Clause 1 Clause 2 Clause 3 Clause 4 Clause 5 Chapter 9 of the 2026 Laws of Maryland (House Bill 1221) added Public Safety Article sections 9-1101 to 9-1106, effective October 1, 2026. They apply only to a short-term rental unit offered for less than 30 consecutive days. The host must conspicuously post an evacuation diagram identifying all exits and a list of emergency numbers for police and fire rescue, and provide a working fire extinguisher and working smoke and carbon monoxide alarms. Booking services must electronically notify hosts of these requirements and require each host to provide the inspection confirmation for each unit. By July 1, 2028, each county and Baltimore City must, by local law or regulation, require annual inspections of all short-term rental units for these requirements (this does not apply to a county that prohibits short-term rentals) and may charge an inspection fee. The law does not require a county or Baltimore City to allow short-term rentals and does not preempt other local measures. In the 2026 session, House Bill 993 (local rules on short-term rentals run by tenants) passed the House; its last action shown, on April 13, 2026, was Second Reading Passed in the Senate, and it has no chapter number. |
Changes
Recent and pending changes
We read County Code Chapter 54, Article III (Secs. 54-42 to 54-49), the DHCA short-term rental page and FAQ, and Executive Regulations 2-25 and 27-25 as published on October 18, 2026. We haven't reviewed the County Zoning Ordinance, the County budget fee resolution or County Council agendas yet, so we will watch the Code, the DHCA page and the Council agendas for changes.
The regulation sets application documents, proof of primary residence, neighbor notification, grounds for denial (including an accessory dwelling unit on the property) and suspension steps. The saved copy has a comment deadline of December 31, 2025 and a blank effective date, so we can't confirm it is in force; the DHCA page says the department follows it.
Sources
Every rule above links to one of these
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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.