Short-Term Rental Taxes in Oklahoma: What Investors Need to Know in 2025
0.25–4.75% graduated income tax (top rate 4.75%) | Conforms to federal bonus depreciation | 4.5% state sales tax + local taxes | Broken Bow/Hochatown = fastest-growing cabin STR market in the South | Grand Lake and Lake Eufaula also active markets
Oklahoma is home to one of the most compelling STR market stories in the country: the Broken Bow/Hochatown cabin market in McCurtain County. Driven by proximity to the Dallas-Fort Worth metropolitan area, the dense Ouachita National Forest setting, and Beavers Bend State Park, this market has seen explosive growth that consistently outpaces supply. Oklahoma's full conformity to federal bonus depreciation and a top income tax rate of 4.75% make the state's STR tax environment among the most favorable in the South.
Oklahoma State Income Tax
Oklahoma's graduated income tax ranges from 0.25% to 4.75%, with the top rate applying to taxable income over approximately $12,200 for single filers and $15,000 for joint filers. Most STR investors will reach the 4.75% top rate quickly. Oklahoma conforms to federal tax treatment of rental income, and the full benefit of cost segregation deductions — including bonus depreciation — reduces Oklahoma taxable income dollar-for-dollar.
Oklahoma Sales Tax on STR Rentals
| Market / Jurisdiction | State Sales Tax | County/City Tax | Estimated Total |
|---|---|---|---|
| Broken Bow / Hochatown (McCurtain County) | 4.5% | 5.5–8% | ~10–12.5% |
| Grand Lake (Mayes/Delaware/Ottawa County) | 4.5% | 3–5% | ~7.5–9.5% |
| Lake Eufaula (McIntosh County) | 4.5% | 3–4% | ~7.5–8.5% |
| Oklahoma City (Oklahoma County) | 4.5% | 4.375% | ~8.875% |
| Tulsa (Tulsa County) | 4.5% | 4.017% | ~8.5% |
| Medicine Park (Comanche County) | 4.5% | 3% | ~7.5% |
Broken Bow / Hochatown: Oklahoma's STR Phenomenon
No discussion of Oklahoma STR investing is complete without highlighting Broken Bow and Hochatown. Located in the pine forest foothills of the Ouachita Mountains in far southeastern Oklahoma, this area has become one of the most talked-about cabin markets in the country. The combination of factors that drove explosive growth is instructive for any investor evaluating the market:
- Proximity to DFW: Broken Bow is approximately 3.5 hours from Dallas — ideal for a long weekend escape from one of America's largest metro areas
- Unique pine forest setting: The dense Ouachita pine forests look nothing like typical Oklahoma topography — the foggy, misty aesthetic photographs beautifully and differentiates the market
- Beavers Bend State Park: State park with river activities, hiking, miniature golf, and a nature center anchors the recreation infrastructure
- Luxury cabin supply: Developers built high-end A-frame and modern cabins with hot tubs, fire pits, and designer interiors that photograph perfectly for listing platforms
- Year-round demand: Summer camping, fall foliage, holiday escapes, and winter cozy retreats maintain consistent occupancy across seasons
Revenue figures in Broken Bow/Hochatown are impressive: well-positioned 2-bedroom luxury cabins routinely generate $70,000–$120,000 annually. Larger premium properties with multiple bedrooms, outdoor amenities, and designer interiors can generate $150,000–$250,000+. New cabin construction has been rapid, but demand has largely kept pace in the highest-quality segments of the market.
Grand Lake and Lake Eufaula
Grand Lake O' the Cherokees in northeastern Oklahoma is the state's premier lake STR market, drawing boaters, fishermen, and water sports enthusiasts from the Tulsa metro. Lake Eufaula — one of the largest man-made lakes in the U.S. — offers similar lakefront STR opportunities at generally lower property prices. Both are more seasonal than Broken Bow, with peak demand concentrated in summer.
Cost Segregation in Oklahoma: Broken Bow Cabins
Broken Bow's luxury A-frame cabins are excellent cost segregation candidates. High-design interiors (premium furniture, designer lighting, hot tub decks, fire pit terraces, outdoor kitchens) create above-average personal property ratios. A typical $500,000 Hochatown cabin might have 28–35% of its value in 5-year and 15-year property — $140,000–$175,000 in bonus-eligible deductions. At 37% federal + 4.75% Oklahoma state, first-year combined savings could reach $58,800–$73,500.
Get Your Oklahoma STR Cost Segregation Estimate
Broken Bow luxury cabins often yield 28–35% personal property ratios — among the highest in the country. Get your free estimate.
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