Overview: Are Short-Term Rentals Allowed in Pigeon Forge, TN?

Yes, short-term rentals are explicitly permitted in Pigeon Forge, Tennessee. The city has established a comprehensive regulatory framework that allows for the operation of short-term rental units (STRUs) while maintaining specific requirements for permits, safety standards, and operational compliance. However, there are zoning restrictions and permitting requirements that must be followed to operate legally.

How to Start a Short-Term Rental Business in Pigeon Forge

Starting a short-term rental business in Pigeon Forge requires following a structured process that includes obtaining proper permits, meeting safety requirements, and ensuring compliance with local regulations.

Step-by-Step Process:

1. Verify Property Zoning Eligibility: Check that your property is located in an approved zoning district for short-term rentals
2. Obtain City and County Business Licenses: Required before applying for STR permits
3. Apply for Short-Term Rental Unit Permit: Submit application with required documentation
4. Complete Safety Inspections: Ensure property meets all health and safety requirements
5. Register for Tax Collection: Set up systems to collect and remit required taxes
6. Secure Appropriate Insurance: Obtain liability coverage meeting state requirements
7. Post Required Information: Display permit numbers and contact information as required

Required Documents, Permits, Licenses, and Guidelines

Required Permits and Licenses:

• City Business License: $15 fee
• County Business License: $15 fee
• Short-Term Rental Unit Permit: $300 for initial application

Required Documentation:

• Permit application form
• Property address and detailed information
• Owner's name, address, phone number, and email
• Applicant's name, address, phone number, and email
• Local contact person's name, address, phone number, and email
• Hosting platforms and websites information
• Proof of property ownership
• Proof of residency (if applicable)
• Site plan of the property
• Completed Life Safety Compliance Verification Form

Permit Types Available:

1. Owner Occupied: For properties that serve as the owner's primary residence (excludes duplexes). Limited to one permit per person.

2. Non-Owner Occupied: Available to property owners or lessees (with owner approval) for properties that are not the primary residence.

3. Unoccupied: For properties occupied only when used as short-term rentals. Available to owners or their agents/property managers.

Permit Renewal:

• Permits are valid for one year
• Non-transferable between owners or properties
• Must be renewed annually before expiration

Specific Regulations for Short-Term Rentals

Local Pigeon Forge Regulations:

Zoning Restrictions:

• Properties in R-1 zoning districts can only operate as short-term rentals if they were operating as such on or before August 13, 2018 (grandfathered properties)
• New short-term rentals are restricted from certain residential zoning areas

Occupancy Limits:

• Maximum of two guests per bed
• Maximum of two beds per room
• Overall property maximum of 12 persons regardless of size

Operational Requirements:

• Must display permit number on all signage
• Principal renters must be 21+ years of age
• Cannot rent for periods less than 24 hours
• Must post owner's name and phone number within rental unit
• Local contact person must be available for guest issues

Safety Requirements:

• Smoke alarms in all required areas
• Carbon monoxide detectors on every habitable floor
• Fire extinguishers (5-pound minimum in each unit)
• Compliance with all building and safety codes

Sevier County Requirements:

• Annual Short-Term Rental Unit Inspection Program (effective January 1, 2024)
• Safety inspections covering fire extinguishers, smoke alarms, escape routes, electrical safety, and more
• Inspection fee: $250 for properties hosting 12 guests or less, plus $25 per person for higher capacity

State-Level Tennessee Requirements:

• Liability insurance minimum of $500,000 unless marketplace provides equivalent coverage
• Compliance with Tennessee Short-Term Rental Unit Act
• Must collect and remit state sales tax (7%)
• Registration with Tennessee Department of Revenue

Tax Obligations

State Taxes:

• Tennessee State Sales Tax: 7%
• Tennessee Department of Revenue Registration: Required for all STR operators

Local Taxes:

• City Hotel Occupancy Tax: 2.50%
• Sevier County Lodging Tax: 3%
• Total Combined Sales Tax: 9.75%

Additional Tax Considerations:

• Property tax (may be classified as commercial property in some cases)
• Federal and state income tax on rental income
• Quarterly estimated tax payments if earning over $1,000 annually

Contact Information for Local Authorities

Primary Regulatory Authority:

Pigeon Forge Planning and Development Department

• Phone: (865) 429-7350
• Address: 3212 Parkway, Pigeon Forge, TN 37863
• Website: www.cityofpigeonforgeTN.gov

Additional Contacts:

Sevier County Assessor's Office

• Phone: (865) 453-5501

Tennessee Department of Revenue

• Website: www.tn.gov/revenue

Penalties and Enforcement

Potential Penalties:

• Fines up to $500 per violation for non-compliance
• $50 fine for operating without proper permits
• Potential revocation of rental permits for serious violations
• Legal action for continued non-compliance
• Possible ban from operating STR business for up to one year

Enforcement:

• Regular inspections by city and county officials
• Complaint-driven enforcement from neighbors and guests
• Monitoring of online platforms for unpermitted properties

Links to Source Pages

• STRProfitMap Pigeon Forge Regulations: www.strprofitmap.com/regulations/TN/pigeon-forge
• Tennessee Short Term Rental Laws Guide: www.gosummer.com/post/tennessee-short-term-rental-laws
• Tennessee STR Regulations Overview: www.hostfully.com/regulations/tennessee/

Important Disclaimers and Recommendations

Legal Disclaimer: This guide is for informational purposes only and should not be considered definitive legal advice. Short-term rental regulations change frequently, and investors should always verify current requirements with local authorities and consult with legal professionals for specific guidance.

Best Practices Recommendations:

• Maintain comprehensive property insurance beyond minimum requirements
• Implement robust safety protocols and emergency procedures
• Develop clear house rules and guest communication systems
• Keep detailed records of all rental income and expenses for tax purposes
• Stay informed about regulatory changes through city communications
• Consider working with experienced local property management companies familiar with Pigeon Forge regulations

Market Considerations: While Pigeon Forge allows short-term rentals, the market shows strong performance with growing tourism demand. However, zoning restrictions and increased regulation may limit available properties for new investors. Due diligence on specific property locations and compliance requirements is essential before making investment decisions.