Overview for STR Investors: Short-term rentals (STRs) are permitted in Zionsville, Indiana under state-level regulations established by Indiana House Bill 1035 (2018). Zionsville does not have specific local ordinances prohibiting STRs. However, operators must comply with state laws, county regulations, and potentially seek zoning approvals for certain situations. Careful compliance is critical, as evidenced by past enforcement actions in residential areas. (Sources: 1, 2, 3)

1. Starting a Short-Term Rental Business in Zionsville

Zionsville lacks city-specific STR licensing or permitting requirements. Compliance primarily occurs at the state and county levels, along with adherence to zoning and general property regulations.

1. Understand Zoning: Zoning is the most significant local hurdle. While STRs cannot be outright banned by state law, Zionsville has historically interpreted rentals in residential areas (like the Village) as prohibited Bed & Breakfasts or incompatible with single-family zoning. Always verify zoning compliance with the Zionsville Planning Department BEFORE listing a property. The case of the Totty's Airbnb (see Sources) demonstrates the risk of enforcement. An STR operating as a "boarding house" or involving non-owner occupants could be deemed an illegal land use. Confirm your property's zoning district and whether "Bed & Breakfast," "Boarding House," or similar uses are permitted (likely requiring a special exception or variance via the Board of Zoning Appeals (BZA)). (Source: 1)
2. Obtain Required Permits/Licenses:
   • Business Permit (State): You will likely need a State of Indiana Business License to operate any business, including an STR. Contact the Indiana Secretary of State.
   • County Permits: While not detailed in the sources, Boone County may have general business registration or innkeeper's tax permits. Check with the Boone County Government offices.
3. Secure Insurance: Indiana state law mandates primary liability insurance specifically covering the STR operation and third-party claims during guest stays. Personal homeowner's insurance typically excludes commercial STR activities. Specialized commercial liability insurance (e.g., from providers like Proper Insurance) is essential and legally required. (Source: 2)
4. Collect and Remit Taxes: Hosts must collect and remit specific taxes:
   • Indiana Gross Retail Tax (Sales Tax): 7% on bookings of 29 nights or less. (Source: 2)
   • Boone County Innkeeper's Tax: Percentage varies by county (likely 2-5% for Boone). Hosts are responsible for collecting this from guests and remitting it to the county. (Source: 3). Register with the Boone County Treasurer/Auditor.
5. Operate Legally: Adhere to state limits on local bans and overly restrictive regulations. Respect noise, trash, occupancy limits, and other local ordinances that apply to all residential uses. Be a good neighbor. (Source: 2)
6. Compliance is Key: The 2016 case shows complaints can trigger enforcement. Maintain permits, insurance, tax records, and ensure strict adherence to zoning requirements.

Recommendation: Before investing or listing, contact the Zionsville Planning & Development Department to discuss your specific property and intended STR operation (e.g., owner-occupied vs. whole-home rental, detached space vs. main dwelling). Proactively determine if zoning approval is needed and pursue it before listing.

2. Required Documents, Permits, Licenses, and Guidelines

While Zionsville lacks specific STR ordinances, the following are typically required or strongly recommended based on state law, county requirements, and prudent business practices:

• State-Level:
  • Indiana State Business License: Apply through the IN Secretary of State.
  • Primary Liability Insurance Certificate: Mandatory for the STR operation. Must be kept current. Obtain quotes from insurers like Proper Insurance.
  • State Tax Permits/Registration: Register with the Indiana Department of Revenue to collect/remit Gross Retail Tax.
• County-Level:
  • Boone County Innkeeper's Tax Registration/Remittance: Contact Boone County government (Treasurer/Auditor) for registration and filing procedures.
  • Potential County Business Registration: Verify if required.
• Local (Zionsville) - Zoning & General:
  • Zoning Verification Letter/Approval: Obtain written confirmation from the Planning Dept that your STR use is permitted or identify the process (e.g., BZA Special Exception) to obtain approval. This is critical.
  • Adherence to Zoning: Documentation confirming compliance with the approved zoning use (e.g., if approved as a Special Exception, comply with all conditions).
  • Adherence to General Property & Safety Codes: Maintain the property in safe condition per local housing codes and fire safety regulations.
  • Adherence to Local Ordinances: Follow noise, trash, parking, and occupancy limits enforced by the town.
• Operational:
  • Guest Screening Procedures: While not legally mandated, robust screening helps ensure community safety and compliance. Document your process.
  • House Rules: Clearly defined rules for guests regarding noise, occupancy, parking, etc., must be communicated and enforced.
  • Tax Records: Meticulous records of bookings, income, taxes collected, and remittances.
  • Insurance Documentation: Keep current certificates readily available.
  • Permit/Registration Copies: Maintain copies of all permits/registrations.

Important: Zionsville's lack of specific STR rules means compliance hinges heavily on interpretation of existing zoning codes and application of state/county requirements. Proactive communication with planning officials is paramount.

3. Specific Regulations for Short-Term Rentals (Zionsville/Township/County/State)

• Zionsville (Town Level):
  • Zoning is Paramount: STRs in residential districts have been interpreted as prohibited Bed & Breakfasts or Boarding Houses. Owner-occupied status may be crucial. Properties renting space above detached garages (like the 2016 case) have faced enforcement. Confirm zoning compliance for EVERY property. (Source: 1)
  • No Specific STR Ordinance: As of the latest sources (2023/2024 market overview), Zionsville does not have a dedicated STR permitting or operational ordinance. (Source: 3)
  • General Ordinances Apply: Town ordinances covering noise, trash, parking, safety, and land use (zoning) still apply fully. Violations can lead to enforcement action.
• Boone County Level:
  • Innkeeper's Tax: Requires collection and remittance of the county innkeeper's tax on STR bookings. Contact Boone County offices for the specific rate and filing procedures. (Source: 3)
  • Potential General Business Rules: Verify any county-level registration or health/safety requirements applicable to STRs.
• State Level (Indiana - HB 1035 & Beyond):
  • No Bans: Cities/towns cannot outright ban STRs like Airbnb/VRBO. (Source: 2)
  • Permits Allowed: Local governments can require permits, but cannot make the process "unduly onerous" or effectively a ban. Permit fees may be capped (e.g., $150/year in some descriptions). Zionsville has not enacted a specific permit requirement under this law based on available info. (Source: 2)
  • Liability Insurance Mandatory: Operators must carry primary liability insurance covering the rental operation. (Source: 2)
  • Gross Retail Tax (Sales Tax): 7% sales tax applies to bookings ≤29 nights. Hosts must collect and remit. (Source: 2)
  • Local Zoning Authority: HB 1035 did not eliminate local zoning authority. Towns can still enforce zoning ordinances against STRs deemed incompatible (like Bed & Breakfasts in residential zones). (Source: 2)
  • Operational Rules: Some Indiana cities (e.g., Indianapolis, Carmel) have additional rules (e.g., min stay, occupancy limits, guest policies). These are city-specific and Zionsville hasn't adopted similar rules per available sources. (Source: 2, 3)
• State Tax Obligations: Collecting/remitting Gross Retail Tax and County Innkeeper's Tax is mandatory statewide. (Source: 2)

4. Contact Information

Since Zionsville lacks a dedicated STR department, contact the following key authorities:

• Zionsville Planning & Development Department (Zoning/Compliance Verification):
  • Website: Find via official Zionsville website (www.zionsville-in.gov/)
  • Phone: Contact via main town line (317) 873-5415 and ask for Planning.
  • Email: Contact via main town email or specific department if listed.
  • Address: Check official town website or directory. (Town Hall is commonly the main point of contact).
  • Purpose: CRITICAL: Verify zoning compliance for your STR location BEFORE listing. Discuss whether your intended operation is permitted, requires a BZA Special Exception, or is prohibited.
• Indiana Secretary of State (Business Licensing):
  • Website: www.in.gov/sos/
  • Phone: (317) 232-6531
  • Purpose: Obtain State of Indiana Business License.
• Indiana Department of Revenue (Taxation):
  • Website: www.in.gov/dor/
  • Phone: (317) 232-2240
  • Purpose: Register for Gross Retail Tax collection and file remittances.
• Boone County Government (Innkeeper's Tax/County Registration):
  • Website: www.co.boone.in.us/ (or search "Boone County Indiana")
  • Phone: Check county website directory (typically main line).
  • Treasurer/Auditor Office: Contact this office specifically for innkeeper's tax registration and procedures.
  • Purpose: Register for Boone County Innkeeper's Tax collection and remit taxes. Verify if county-level business registration is required.
• Zionsville Board of Zoning Appeals (BZA): (For Variance/Special Exception)
  • Contact via: Zionsville Planning & Development Department.
  • Purpose: If zoning verification indicates your STR requires a Special Exception or Variance for your specific property/use.

5. Links to Source Pages (Available)

• STR Operation & Zoning Enforcement (2016 Case): youarecurrent.com/2016/06/30/zionsville-board-of-zoning-appeals-to-consider-impact-of-short-term-rental-in-village/
• Indiana Statewide STR Laws (HB 1035, Permits, Insurance, Taxes): www.steadily.com/blog/airbnb-short-term-rental-laws-and-regulations-in-indiana
• Zionsville Market Overview (No Specific STR Rules Noted): www.gosummer.com/vacation-rental-management/zionsville-indiana
• Zionsville Plan Commission Minutes (Not STR Related, But Shows Zoning Process): zionsville-in.gov/DocumentCenter/View/8896/PC_Meeting-02-18-2025---DRAFT-Minutes

Disclaimer: This guide is based solely on the provided source material. Zionsville's regulations may evolve. Always verify current requirements with the Zionsville Planning & Development Department before listing a property. State and county regulations change; confirm details with the Secretary of State, Department of Revenue, and Boone County offices.