(1) When lodging sales are combined with food, beverage, recreation, or other charges which are a substantial portion of the charge, the seller shall collect the lodging facility sales and use tax by establishing an accommodation charge using one of the following methods:

(a) the allowable state reimbursement for the standard cost of in-state lodging each day for each person;

(b) 25 percent of all charges each day for each person; or

(c) a charge justified by reasonable documentation.

(2) As required by 15-65-113, MCA, and 15-68-502, MCA, a seller must maintain and have available for inspection, records to substantiate the items referred to in (1)(a) through (c). The department may request the seller to substantiate the method used and itemize each charge to verify the correct amount of tax.

(3) Lodging facility sales and use taxes do not apply to separately stated charges which are not an integral part of the use or occupancy of the room or campground space, such as but not limited to:

(a) telephone;

(b) Wi-Fi access;

(c) faxes/copies;

(d) television;

(e) food;

(f) beverage;

(g) pet charge; or

(h) personal laundry charges.

(4) The department may disallow a seller's method of allocating the lodging facility sales and use tax under (1) if:

(a) the department has reasonable cause to believe that the method of allocation was chosen solely to qualify the facility for a tax exemption as provided in ARM 42.14.103; or

(b) a charge allocated under (1)(c) is not supported by reasonable documentation or itemization.

(5) Lodging facility sales and use taxes include amounts charged for bathhouse facilities or temporary use of tangible personal property used in conjunction with the room, such as a charge for an extra bed.

(6) If campgrounds charge for water, electrical or sewer hookups, and bathhouse facilities, those charges are included in the amount that is subject to tax.

(7) If the facility charges for electricity as a separate or additional charge, this charge must be included in the amount that is subject to the tax.