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Madison, WI

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STR Regulations for Madison, Wisconsin

Yes—short-term rentals (STRs) are allowed in Madison and throughout Dane County, Wisconsin. In state law, STRs are classified as Tourist Rooming Houses (TRHs). Public Health Madison & Dane County licenses and inspects TRHs (and other lodging types like bed & breakfasts and hotels) each year to ensure compliance with Wisconsin public health laws. In Madison specifically, STRs are also subject to zoning requirements, and you must obtain a city Zoning Tourist Rooming House Permit (ZTRHP1) before advertising or renting. [Public Health Madison & Dane County – Places to Stay], [City of Madison – Short-Term Rental FAQ].

Important legal definitions and limits (what makes a legal STR in Madison and Dane County):

  • Wisconsin/Dane County context: Wisconsin law defines a TRH as a place where sleeping accommodations are offered for pay for tourists/transients. Dane County states short-term rentals are commonly “less than 60 days” stays. [Public Health Madison & Dane County – Places to Stay].
  • City of Madison definition: Under city zoning, a TRH is “rental of any partial or whole structure for sleeping purposes for less than 30 nights.” You must have a ZTRHP1 before advertising or renting. [City of Madison – Short-Term Rental FAQ].
  • Host presence rules (Madison):
    • If the operator (host) is on site for guest stays, there is no limit to the number of nights rented.
    • If the operator is not on site, the STR may operate a maximum of 30 nights per licensing year. [City of Madison – Short-Term Rental FAQ].
  • Primary residence requirement (Madison): The STR must be the operator’s primary residence. If renting an ADU, only the unit that is the operator’s primary residence can be operated as a TRH. [City of Madison – Short-Term Rental FAQ].

Bottom line for investors: STRs are allowed in Madison subject to licensing, zoning, tax, and inspection requirements. City rules are stricter than county/state definitions, particularly the 30-night limit when the host is not present and the primary residence requirement.

How to Start a Short-Term Rental (STR) Business in Madison

Follow these steps in order:

  1. Confirm zoning eligibility and primary residence status
  • Call Madison Zoning at 608-266-4551 (press 3 for STRs or the listed extension) and review the Short-Term Rentals and TRH Zoning FAQs.
  • Confirm your property is allowed for STR use and that you can meet the primary residence requirement. [City of Madison – Short-Term Rental FAQ], [Public Health Madison & Dane County – Places to Stay].
  1. Obtain required state and local tax registrations
  • Wisconsin Seller’s Permit: Required unless you list exclusively on Airbnb and/or VRBO (in which case the platform handles sales tax). Apply via the Wisconsin Department of Revenue. [Public Health Madison & Dane County – Places to Stay].
  • Room Tax (City of Madison or your municipality):
    • City of Madison: Complete a Room Tax Registration form. If renting only via Airbnb/VRBO, these platforms collect and remit Madison’s room tax; you typically do not need a separate room tax registration (check the applicable box on the City’s form). [Public Health Madison & Dane County – Places to Stay], [City of Madison – Room Tax Registration].
  • Wisconsin Sales Tax: 5.5% combined (5% state, 0.5% Dane County). Occasional sales exemption may apply if taxable sales are less than $1,000 in a calendar year. If you only list on Airbnb, Airbnb automatically collects and remits Wisconsin sales tax. [Public Health Madison & Dane County – Places to Stay].
  1. Get a TRH license from Public Health Madison & Dane County
  • Submit the Lodging License Application and pay fees. Public Health conducts a pre-inspection and then an annual inspection to verify compliance with health and safety standards. [Public Health Madison & Dane County – Places to Stay].
  • Contact Public Health to schedule your pre-inspection: 608-242-6515 or LEadmin@publichealthmdc.com (for pre-licensing), or str@publichealthmdc.com (for STR-specific scheduling). [Public Health Madison & Dane County – Places to Stay].
  1. Apply for the City of Madison ZTRHP1 permit
  • You must have a TRH license from Public Health before you can apply for the ZTRHP1.
  • The application includes a home visit to verify floor plans and bedroom counts and to review regulations.
  • Fees: $300 one-time, non-refundable application fee plus a $100 annual permit fee. [City of Madison – Short-Term Rental FAQ].
  1. Maintain ongoing compliance
  • Health inspection: Required annually by Public Health (licensing year July 1–June 30). [Public Health Madison & Dane County – Places to Stay].
  • Quarterly reporting (Madison): Create an online account and submit ZTRHP Quarterly Reports (ZTRHP-QR) each quarter, including ad locations and registry information. [City of Madison – Short-Term Rental FAQ].
  • Registry: Maintain a paper or digital registry of all stays with guests’ names, contact info, dates, and whether the operator was present. [City of Madison – Short-Term Rental FAQ].
  • Renewal: Pay the $100 annual ZTRHP1 permit fee. If your permit is not renewed by June 30, the STR must stop operating until renewal. [City of Madison – Short-Term Rental FAQ].

What do Airbnb hosts actually earn in Madison?

Madison hosts earn a median $35,434/year with $181 ADR and 65% occupancy.

Top performers pull in $51,124+ per year.

See the full Madison market breakdown

Required Documents, Permits, Licenses, and Guidelines

Permits and licenses (order matters)

  • Zoning Tourist Rooming House Permit (ZTRHP1) – City of Madison
    • One-time application fee: $300
    • Annual permit fee: $100
    • Primary residence verification and home visit required. [City of Madison – Short-Term Rental FAQ].
  • Tourist Rooming House (TRH) License – Public Health Madison & Dane County
    • Lodging License Application required.
    • Pre-inspection prior to approval; annual inspection thereafter. [Public Health Madison & Dane County – Places to Stay].
  • Zoning approvals – City of Madison
    • Contact Madison Zoning (608-266-4551) to confirm zoning eligibility and any conditional use or other zoning matters. [Public Health Madison & Dane County – Places to Stay], [City of Madison – Short-Term Rental FAQ].
  • Room Tax Registration – Madison Treasurer/City Clerk
    • City of Madison Room Tax Registration form; exemptions apply if only listing via Airbnb/VRBO. [Public Health Madison & Dane County – Places to Stay], [City of Madison – Room Tax Registration].
  • Wisconsin Seller’s Permit (sales tax registration)
    • Required unless listing exclusively on Airbnb/VRBO. [Public Health Madison & Dane County – Places to Stay].

Key guidelines and references

  • ATCP 72: Hotels, Motels, and Tourist Rooming Houses (Wisconsin Administrative Code). [Public Health Madison & Dane County – Places to Stay].
  • ATCP 73: Bed and Breakfast Establishments (Wisconsin Administrative Code). [Public Health Madison & Dane County – Places to Stay].
  • Inspection checklists (TRH), sanitization directions, and jetted tub cleaning procedures. [Public Health Madison & Dane County – Places to Stay].
  • Madison STR regulations, ZTRHP application process, and quarterly reporting forms (ZTRHP-QR). [City of Madison – Short-Term Rental FAQ].

Documents you will likely need

  • Valid government ID; property ownership or lease documentation.
  • Floor plans (for home visit); site plan if applicable.
  • Proof of insurance (as required by city/zoning during application).
  • Federal EIN; SSN/ITIN for tax registrations.
  • Sales tax registration; room tax registration (unless platform-handled).
  • Inspection reports and correspondence from Public Health.

Specific Regulations in Madison, Dane County, and Wisconsin

City of Madison STR rules

  • Definition: TRH = rental for fewer than 30 nights. [City of Madison – Short-Term Rental FAQ].
  • Primary residence: The STR must be the operator’s primary residence; only one primary residence per person. [City of Madison – Short-Term Rental FAQ].
  • Host presence limits:
    • Host on site: no night limit.
    • Host not on site: maximum 30 nights per licensing year. [City of Madison – Short-Term Rental FAQ].
  • Occupancy: Maximum guests = 2 × number of legal bedrooms (up to 12). Children under 12 are not counted toward the cap. [City of Madison – Short-Term Rental FAQ].
  • Bedrooms: A legal bedroom must have a door, meet egress/light/ventilation standards, and be ≥70 sq ft (exclusive of closets). Dens/libraries that meet criteria can qualify. [City of Madison – Short-Term Rental FAQ].
  • Quarterly reporting: ZTRHP operators must submit ZTRHP-QR forms online each quarter (even if no stays) listing all ads and registry data. [City of Madison – Short-Term Rental FAQ].
  • Advertising/renting: ZTRHP1 permit is required before advertising or renting. [City of Madison – Short-Term Rental FAQ].
  • Taxes:
    • Room tax: If only using Airbnb/VRBO, they collect and remit Madison’s room tax; you may not need a separate room tax registration. [Public Health Madison & Dane County – Places to Stay].
    • Sales tax: 5.5% total (state + county). Airbnb handles state sales tax if you only list through them. Occasional sales exemption if annual taxable sales < $1,000. [Public Health Madison & Dane County – Places to Stay].

Dane County licensing and health requirements

  • All bed & breakfasts, hotels, and TRHs (STRs) in Dane County must be licensed and inspected annually by Public Health. [Public Health Madison & Dane County – Places to Stay].
  • Licensing year: July 1–June 30. If approved in April–June, license runs until the end of the following licensing year. [Public Health Madison & Dane County – Places to Stay].
  • Pre-inspection required before approval; inspections verify compliance with state health/safety rules. [Public Health Madison & Dane County – Places to Stay].

State of Wisconsin regulations

  • STRs (1–4 sleeping accommodations) are governed as TRHs under Wisconsin law; 5+ sleeping accommodations are classified as hotels/motels. [Public Health Madison & Dane County – Places to Stay].
  • Health and safety requirements are set by Wisconsin Administrative Code (ATCP 72, ATCP 73). [Public Health Madison & Dane County – Places to Stay].
  • State sales tax: 5% (Dane County adds 0.5% for a combined 5.5%). Occasional sales exemption applies under $1,000 annual taxable sales. Airbnb collects and remits state sales tax if you list exclusively through them. [Public Health Madison & Dane County – Places to Stay].

Notes and practical considerations

  • HOA/condo/co-op rules: Private associations may restrict STRs; the City does not enforce private covenants. Review your HOA/condo documents and lease terms. [City of Madison – Short-Term Rental FAQ].
  • Lakefront/zoning specifics: Additional land-use/zoning restrictions can apply near lakes and in certain zoning districts. Confirm with Zoning before acquiring or listing. [Steadily blog overview on Madison STRs].

Contact Information (Phone, Email, Website)

  • Public Health Madison & Dane County – Environmental Health (licensing, inspections)
    • Phone: 608-242-6515
    • Email (general licensing): LEadmin@publichealthmdc.com
    • Email (STR scheduling): str@publichealthmdc.com
    • Health inspection lookup portal: Health Inspections
    • Public Health main phone: 608-266-4821
    • Website: Public Health Madison & Dane County – Places to Stay
  • City of Madison – Building Inspection / Zoning (ZTRHP permit, rules, reporting)
    • Phone: 608-266-4551 (press 3 for STR/Tourist Rooming House inquiries or as directed)
    • Email (Zoning/TRH): zoningtrh@cityofmadison.com
    • Contact form: City of Madison – Building Inspection Contact
    • Website: City of Madison – Short-Term Rentals (TRH)
  • City of Madison – Room Tax Registration
    • Form: Room Tax Registration (City of Madison)
    • Website: City of Madison – Room Tax Overview and Exemptions
  • Wisconsin Department of Revenue (Seller’s Permit/Taxes)
    • Website: Wisconsin Department of Revenue – Seller’s Permit

Links to Source Pages (Important)

Final note for investors: Madison is an STR-friendly market but with strict local rules—particularly around host presence, primary residence, and quarterly reporting. Confirm zoning, secure both the Public

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Madison

Market Saturation Score

036912
High Saturation
8/ 12
months with declining YoY revenue
8–10 declining months: high saturation - supply likely outpacing demand.
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Photos of Madison

Overview of Madison

Madison is the capital of Wisconsin and the seat of Dane County, set on a narrow isthmus between Lake Mendota and Lake Monona. With a city population of roughly 270,000 and a metro area approaching 700,000, Madison has the feel of a lively college town wrapped around a working government center, anchored by the flagship campus of the University of Wisconsin–Madison. The city is best known for its blend of academic energy, lakeside recreation, progressive politics, and one of the country's most celebrated farmers' markets. It lies about 80 miles west of Milwaukee and roughly 150 miles northwest of Chicago, making it a convenient stop for travelers crossing the upper Midwest.

The most recognizable landmark in town is the Wisconsin State Capitol, a domed granite building completed in 1917 and modeled partly on the U.S. Capitol. Sitting atop an elevated square at the head of State Street, it anchors the downtown core and is open for free guided tours that climb to the observation deck for views over the lakes and the university. Just a short walk down State Street, visitors find a pedestrian-friendly corridor of bookshops, restaurants, and student hangouts that links the Capitol to the UW campus.

For lakeside culture, Monona Terrace, designed by Frank Lloyd Wright and completed after his death, juts out into Lake Monona and serves as a community and convention center with a rooftop terrace that draws crowds in warm weather. Across the isthmus, the university’s Memorial Union Terrace on Lake Mendota offers a similar draw, with outdoor seating, live music, and sailboats drifting by — a scene that helps define Madison’s laid-back summer identity.

Just east of downtown, Olbrich Botanical Gardens offers 16 acres of themed gardens, including a rare Thai pavilion, and is free to visit year-round. To the northwest, about 40 miles from the city, [Devil's Lake State Park](en.wikipedia.org/wiki/Devil%27s_Lake_State_Park_(Wisconsin) provides roughly 2,000 acres of bluffs, quartzite cliffs, and clear water along a 360-acre lake, drawing hikers, swimmers, and climbers throughout the warmer months.

Madison works especially well as a base for short-term rentals because it pairs big-city amenities — a walkable downtown, a major research university, a thriving food scene, and a state capitol — with the kind of outdoor draws that usually require a longer drive. Visitors can spend mornings at the farmers' market on the Capitol square, afternoons on the water or at a botanical garden, and evenings at a Badgers game or a concert on the terrace, all without leaving the metro. That mix of urban energy, lake life, and easy day trips to the surrounding Driftless region gives the city year-round appeal for leisure travelers and visiting families.

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