Overview: Are Short-Term Rentals Allowed in Bethesda, MD?

Yes, short-term rentals are explicitly allowed in Bethesda, Maryland. Short-term rentals (STRs) are permitted under Montgomery County regulations, which apply to Bethesda and other unincorporated areas. STRs are defined as the rental of an entire home or a unit/room in a single-family home, apartment, or condominium for less than 30 consecutive days through online platforms such as Airbnb, VRBO, HomeAway, and Flipkey.

Key Distinction: Bethesda is located within Montgomery County but outside incorporated municipal boundaries. Therefore, Montgomery County regulations apply directly to STR operations in Bethesda. Residents must comply with county-level regulations rather than any city-specific ordinances.

How to Start a Short-Term Rental Business in Bethesda

Step 1: Verify Eligibility

Before proceeding, confirm that your property meets the following basic requirements:

• The property must be your primary residence (you must physically reside there)
• You cannot operate an STR if your property includes a Farm Tenant Dwelling or Accessory Apartment
• The property must comply with all applicable zoning standards under Chapter 59 of Montgomery County Code

Step 2: Obtain Required Tax IDs

Maryland State Tax ID:

• Apply for a Maryland Sales & Use Tax ID before applying for any licenses
• Apply online through the Maryland Tax Portal
• This is mandatory for all STR operators

Montgomery County Room Rental-Transient Tax Registration:

• Register for the 7% Room Rental-Transient Tax
• Apply online through the County's Hotel Tax portal
• This tax applies to all rentals of 30 days or fewer
• File monthly returns on or before the last day of the month for the preceding rental period

Step 3: Apply for Short-Term Rental License

• License Fee: $325 per year (valid for 12 months)
• Application Process: Submit the Short-Term Residential License Registration and Renewal Form through the designated online portal
• Processing Time: Licenses must be approved or denied within 15 working days after receipt of complete application and fees
• License Display: Include your license number on all rental advertisements (Airbnb, VRBO, etc.)

Step 4: Ensure Compliance with Neighborhood Notifications

For Single-Family Homes and Attached Units:

• Notify all abutting and confronting neighbors about your STR application

For Multi-Unit Buildings (Apartments/Condominiums):

• Notify neighbors sharing walls, floors, or ceilings with your unit
• Provide notification to any municipality where the residence is located

Required Documents, Permits, Licenses, and Guidelines

Mandatory Licenses and Permits

1. Short-Term Rental License ($325/year)

   • Valid for 12 months, renewable annually
   • Must include license number on all listings

2. Maryland State Sales & Use Tax ID

   • Required before applying for STR license

3. Room Rental-Transient Tax Registration (7% tax rate)

   • Monthly filing requirement

Required Certifications and Documentation

When applying for your STR license, you must certify that:

• The building complies with all applicable zoning standards
• Only habitable rooms will be used by guests
• Smoke detectors in all units and carbon monoxide detectors in units using natural gas operate as designed
• Sanitation facilities operate as designed
• You have not been found guilty of any violations of this Chapter in the past 12 months
• All local taxes and required fees are paid in full
• The dwelling unit is your primary residence
• You are the owner or authorized agent of the facility
• Posted rules and regulations are inside the rental, including contact information for emergency purposes
• A designated representative resides within 15 miles of the unit and is accessible when you are not present
• A record of all overnight visitors will be maintained and available for inspection
• You have notified relevant neighbors about your application
• The application is permitted by any Homeowner's Association, condominium document, or rental lease
• Except for persons visiting the primary resident, only registered guests will be allowed on the property

Safety Guidelines

• Install functional smoke and carbon monoxide detectors
• Maintain operational sanitation facilities (bathrooms, kitchens)
• Post house rules and emergency contact information inside the rental
• Provide working, accessible fire extinguishers
• Maintain a list of all overnight visitors

Specific Regulations for Short-Term Rentals in Montgomery County

Occupancy Limits

• Maximum total overnight guests (18+ years): 6 per property
• Maximum overnight guests per bedroom: 2 adults (18+ years)

Rental Duration and Day Limits

If the host is NOT present during the rental period:

• Maximum of 90 days per calendar year

If the host IS present during the rental period:

• No limitation on the number of rental days

Parking Requirements

• Provide one off-street parking space per rental contract
• Exception: If your online listing explicitly prohibits vehicle parking

Prohibited Uses

• STRs are prohibited in:
  • Farm Tenant Dwellings
  • Properties that include an Accessory Apartment

Licensing and Renewal Requirements

• Licenses are valid for one year and must be renewed annually
• The County Director must approve or deny license applications within 15 working days
• Self-certification is accepted after verification through available records

Enforcement and Penalties

License Suspension:

• License must be suspended if at least three verified complaints are received within a calendar year
• Renewal or reinstatement procedures are established by the Director

License Revocation:

• A license can be revoked if false certifications are found
• For three years after revocation, neither the former licensee nor any applicant for the same dwelling unit can receive a new license

Appeals Process:

• Any person aggrieved by license approval, denial, revocation, or suspension may appeal to the Board of Appeals
• The Board must hold a hearing within 30 days and act within 30 days after the hearing

Municipal Exemptions

Montgomery County's STR regulations do not apply to properties located in these municipalities:

• Chevy Chase Village
• Town of Chevy Chase
• Town of Chevy Chase View
• City of Gaithersburg
• City of Rockville
• Town of Kensington
• Town of Laytonsville
• Town of Poolesville
• Town of Somerset
• Town of Washington Grove
• Town of Garrett Park

Important: If your property is within any of these municipalities, you must comply with their specific local regulations rather than Montgomery County's rules.

State-Level Regulations (Maryland)

Maryland Sales and Use Tax

• All STR hosts must obtain a Maryland State Sales & Use Tax ID
• Apply through the Maryland Tax Portal
• This is a prerequisite for obtaining county licenses

State Tax Implications

• State sales tax may apply to STR transactions
• Consult with tax professionals for specific state tax obligations

Contact Information

Montgomery County Department of Housing and Community Affairs (DHCA)

• Address: 2425 Reedie Drive, 7th Floor, Wheaton, MD 20902
• Phone: 240-777-0311
• Office Hours: 7:30 AM - 4:00 PM, Monday-Friday
• Website: Montgomery County DHCA STR Licensing

Montgomery County Department of Permitting Services (DPS)

• Address: 2425 Reedie Drive, 7th Floor, Wheaton, MD 20902
• Phone: 240-777-0311
• Office Hours: 7:30 AM - 4:00 PM, Monday-Friday
• Website: DPS Short-Term Rental Information

MC311 (Montgomery County Service Center)

• Phone: 240-777-0311
• Website: MC311 Portal
• Purpose: Report complaints and get information about county services

Maryland Tax Administration

• Website: Maryland Sales & Use Tax ID
• Purpose: Apply for state tax identification numbers

Source Links

• Montgomery County DPS - Short-Term Rentals
• Montgomery County DHCA - Short-Term Rental Licensing
• Montgomery County Code Chapter 54 - Transient Housing
• Airbnb Montgomery County Guide
• Maryland Sales & Use Tax ID Application
• Montgomery County Room Rental-Transient Tax Application
• Zoning Text Amendment 17-03 - Short-Term Residential Rentals

Important Disclaimer: This guide is provided for informational purposes only and does not constitute legal advice. STR regulations can change, and investors should consult with local attorneys and tax professionals to ensure full compliance with current laws and regulations.