Michigan
Short-term rental company sues Michigan over $18.7M tax bill
A nationwide short-term rental company is suing the state of Michigan over a tax audit that found the company owes about $18.7 million in unpaid use taxes to the state.
HomeAway, a Texas-based company best known for its vacation rental platform Vrbo, received a September bill for taxes due from the Michigan Department of Treasury for unpaid use taxes and interest in 2020, 2021 and 2022, totaling $18.7 million, according to the lawsuit filed in the Michigan Court of Claims.
HomeAway maintained in its Dec. 18 filing that it is the homeowners themselves who are responsible for collecting use taxes related to the short-term rental of their homes and remitting those taxes to the state.
“All funds representing use tax collected from guests were disbursed to the hosts,” the company said in its filing.
The state Department of Treasury and HomeAway declined to comment on pending litigation.
The tax fight comes amid a separate, but related, years-long fight in communities across the state and in the Legislature over how to best regulate and, in some cases, tax short-term rentals, which began to grow in popularity in Michigan after the 2008 housing crisis.
The Legislature has toyed with the idea of banning any local regulations over short-term rentals, putting some limits on those local regulations or establishing a statewide policy for short-term rental housing. State Rep. Mark Tisdel, R-Rochester Hills, helped introduce bills this fall that would allow communities to hold a vote on whether to tax short-term rentals locally to pay for essential services such as police or fire. The legislation has yet to receive a hearing.
In its suit filed Dec. 18 in the Michigan Court of Claims, HomeAway maintained that it was cognizant of the state’s 6% use tax and made provisions for its collection. But the ultimate remittance of that tax to the state is left to the homeowner.
When onboarding, according to the suit, a host or homeowner is given options regarding how they collect taxes. In Michigan, they could make it a percentage of the rental amount at booking or collect and remit the tax separately.
In either case, HomeAway argued, the host was responsible for paying the use tax. If the host made it a percentage of the rental amount due at booking, the taxes charged in the booking process were sent back to the host for remittance to the state. If the host indicated he or she would collect and remit on their own, the entire process was left to the host, according to the filing.
“The host acknowledged and represented that the host would handle tax collection from guests independent from HomeAway’s online checkout process,” HomeAway wrote in its filing. “…HomeAway never received or retained any tax amounts.”
In January 2023, the Department of Treasury began an audit of the prior three years, and in June 2025, the department issued a bill for taxes due for the audit period. The department found HomeAway wasn’t responsible for paying taxes if the host indicated he or she would collect and remit on their own. But the department maintained the company was responsible for remitting taxes where the host picked the option requiring the tax to be a percentage of the rental amount due at booking, the lawsuit said.
On Sept. 19, 2025, the Department of Treasury issued an $18.7 million bill, with about $15.1 million owed in use taxes and $3.6 million owed in interest. The bill included a total of $676,246 in use tax and interest for 2020, $8.6 million for 2021 and $9.5 million for 2022.
“The department — for the first time during the audit — alleged that for all bookings for which tax was collected on behalf of and at the request of the host, HomeAway unjustly enriched itself by failing to remit the collected taxes to the department,” the filing said.
The state treasury bills, attached to the lawsuit as exhibits, only note that the money due is for use tax and interest following an audit. There is no mention in the bills of which type of rentals HomeAway was responsible for when it came to remittance of the use tax.
HomeAway, in its lawsuit, denied that it was unjustly enriched, arguing the company didn’t keep any of the tax payments, but instead forwarded them to homeowners to remit to the state.
“It was the hosts — not HomeAway — that were responsible for remittance of use tax to the departments,” the filing said.
HomeAway also alleged the department’s audit violated the federal and state Equal Protection Clauses because it treated HomeAway differently from other similarly situated taxpayers.
“There is no precedent to support the department’s allegation, nor has the department applied this theory to similarly situated taxpayers,” the filing said.
eleblanc@detroitnews.com
Michigan
FCS All-American WR to visit Michigan State this week
Michigan State football is identifying targets across the board to being in for visits as the transfer portal window moves along. The latest visit to go public comes from a wide receiver at the FCS level.
Evan James, a Furman transfer, will be taking a visit to East Lansing starting on Jan. 5. A 5-foot-11, 170 pound receiver from Apopka, Florida, James had a breakout season for the Paladins. In 2025 he caught 65 passes for 796 yards and seven touchdowns. He also had seven carries for 72 yards and a touchdown, doing all of this as a true freshman, earning FCS Freshman All-American honors.
After doing this all as a freshman, he will bring three years of eligibility with him to the next school of his choosing. Aside from Michigan State, it is rumored that Boston College and Cincinnati will also be in contention.
Contact/Follow us @The SpartansWire on X (formerly Twitter) and like our page on Facebook to follow ongoing coverage of Michigan State news, notes and opinion. You can also follow Cory Linsner on X @Rex_Linzy
Michigan
More than 50,000 without power across Michigan before strong storm begins
Even before high winds have kicked in from a strong incoming storm system, more than 50,000 homes and businesses were without power across Michigan.
The bulk of these outages are in Mid-Michigan. Clare County had the largest outage tally, with more than 16,000. Mecosta County had more than 7, 500 without power, and Isabella County had more than 6,000 out.
A couple counties in the very western Upper Peninsula were also reporting outages.
These outage numbers are expected to increase by early Monday, as high winds come in as part of this storm system. Sustained winds of 25 to 35 mph are expected, but wind gusts could top 60 mph in some areas.
The issue with the Mid-Michigan outages is rooted in Friday’s ice accumulation. Utility officials said there has been about a half-inch of ice accumulation on trees and power lines in that area through the weekend. Temperatures this weekend did not get warm enough to melt the ice, as they did in other areas. Heavy rain on Sunday froze again quickly, causing a heavier ice load and more outages.
Consumers Energy has said they have crews mobilized to work on outages as they arise with this storm.
To see the latest update on this storm coverage, follow our headlines on the MLive Weather page.
Michigan
Michigan AD Warde Manuel says firing Sherrone Moore was easy decision
Kyle Whittingham says Bo Schembechler, Michigan hooked him on football
New Michigan coach Kyle Whittingham said on Sunday, Dec. 28, that he watched Bo Schembechler’s Michigan team play Ohio State when he was 7 years old.
ORLANDO, FL — Athletic director Warde Manuel introduced Kyle Whittingham as Michigan football’s 22nd head coach in program history on the second story of the Hyatt Regency Hotel on International Drive in Orlando on Sunday, Dec. 28
It was an unusual setting for such a moment, but then again this has been an unusual month for the Wolverines. They began a search for their new coach shortly after Dec. 10 – the day Sherrone Moore was fired after U-M was presented with “credible evidence” of an inappropriate relationship with a staffer.
Manuel discussed the matter – which culminated with an arrest and multiple charges – for the first time Sunday. He called it difficult personally, but something that he had no hesitation about doing professionally.
“Listen man, it’s hard,” Manuel said. “It’s hard when you have a colleague that is going through something personally, professionally, in his family and [knowing the] people and impact that it has on so many staff, student-athletes and the Michigan community.
“Personally, I’ve known him for seven or eight years, so it was difficult to see him, as a person, go through what he went through. But professionally, it was an easy decision to make because of the expectations that we have for everyone on our side.”
Moore was arrested hours after he was fired from U-M for allegedly breaking into the staffer’s home and threatening to kill himself, according to a police report.
While it was by far the most dramatic scene, in the eyes of many, it was simply the latest negative headline for the Michigan athletic department.
As a result, Michigan brought in outside law firm Jenner & Block to conduct a review into Moore’s situation and the athletic department at large. Manuel told reporters it was in part his idea – something he brought up to interim president Domenico Grasso as an effort to understand how everybody can improve.
“There’s not much I can say. There’s an investigation continuing into coach Moore, there’s a cultural evaluation around the department and so we will we obviously know some facts,” Manuel said. “There’s some things that are out there that I can’t comment on, that are untrue, and there may be some things that they find, but that’s why we do an investigation, and I’m very open to that. Wanted the cultural analysis to be done to help us get better.
“I asked the President to help with a cultural analysis and have somebody come in. So yes, I am very supportive of that, because as a leader, I face reality. There are things that happen. I don’t step away from it. Never have, never will. So we need to get better, and that’s part of is getting somebody to come in and to assess.”
Whittingham, for his part, was not deterred by the optics of instability in Ann Arbor. U-M is likely weeks away from naming a new president, and Manuel’s job security has also been called into question.
Whittingham said he didn’t know the details, but that he believes that his job is to focus on what goes on in Schembechler Hall and allow others to figure out what’s next.
“The answer is no, I didn’t have any hesitation,” he said when asked whether he thought twice about taking the job. “There are some issues, missteps that are being taken care of, but the key is the court players here are rock solid. … I’ve got no doubt everything is going to be handled properly.
“I’m not close enough or knowledgeable enough and privy enough to exactly what’s going on in the details, but I’ve got full confidence that we’ll come out of this just fine. … What I’m concerned with is the players.”
How the hire went down
Manuel has been criticized for not formally interviewing any other candidates before hiring Moore. This time, the initial list was “extensive” before Michigan had more official conversations about 6-8 true potential fits.
Michigan had initial interest in Whittingham and it didn’t take long before the Wolverines learned the feeling was mutual. Whittingham explained how the timing was “uncanny” with how things lined up. He had mulled 2024 being his last season in Salt Lake City but after going 5-7 and cycling through a host of quarterbacks, he didn’t want to go out that way, nor did he want to leave his impending successor, Morgan Scalley, in a hole.
He announced his decision to step down from the Utes on Dec. 12; days later people in his circle and members involved with the search for the Wolverines began contact.
Whittingham wasn’t going to leave for just anywhere, but as a U-M fan from afar since the first football game he turned on the TV at age 7, he had to hear the Wolverines out.
He liked what he heard. The more Manuel heard, the more he liked as well. It’s a sentiment he believes is echoed by the U-M faithful – he said he has already received “hundreds” of text messages from former players, coaches and those involved with the university praising the hire.
“He was a great person for Michigan for us to bring in and continue to drive success,” Manuel said. “With his character, with his integrity – the things that people [around him] talked about were high on my list of characteristics that I wanted from the [next] coach.”
Tony Garcia is the Wolverines beat writer for the Detroit Free Press. Email him at apgarcia@freepress.com and follow him on X at @RealTonyGarcia.
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