We will be hosting two international high school students the next school year through the private school they will attend in Los Angeles. The school will pay us a fixed monthly payment for each student. The school has an arrangement with an agency based in Europe that sets up the logistics of the student's placement with us. We are responsible for room and board and for getting the students to the school and to some extracurricular activities they participate in. So far, my search has not found similar situations. This is not an au pair situation. I am fairly certain we will be taxed as a contractor with the school. I need to know in what percentage of the monthy payment we receive will be taken out in taxes? Thanks

Unless the payment you receive from the school is extravagant, I doubt that it will be considered contract income reported under Form 1099-MISC. It is most likely considered reimbursement for expenses incurred, and thus NOT taxable.

ASK the school to be sure. If it IS contract income, then ALL of the expenses associated with hosting the students are valid expenses that can be deducted on Schedule C. You will then pay taxes on the NEt difference.

School may report payment made to you on Form 1099-misc as payment to independent contractor. School will not withhold any taxes.
You will report this income and associated expenses on schedule C (Form 1040).