My family and I live in a rented townhouse. The lease and all the bills are in our name. Back in Feb., a friend moved in with us (it was originally temporary) as his lease was up and he was due to deploy in the early spring. The deployment was cancelled and because of some other issues, he has stayed with us since then. He pays a sum to us each month to help with rent, utilities, room and board. My question is, does this money need to be counted as income on our taxes (my husband and myself) as it passed through our checking account? My husband says it should, but am thinking it is no different than any other room mate situation since we rent the home, not own it. Any links would be helpful. Thanks so much.
2007-11-02 02:55:49 · 5 answers · asked by Annie 6 in Business & Finance ➔ Taxes ➔ United States
No it is not a rental income. You are not in a rental business. Your are not deducting mortgage interest or property taxes on your return.
Suppose you treat it as a rental income. Then you have to deduct your expenses. If four persons use the house, then 1/4th of utilities cost is your expenses. If you have two rooms and the friend uses one room, then 1/2 of rent is your expenses. Ultimately, you may even have a loss or break-even or negligible profit.
Everyday people move to new cities and look for one bed room apartment. When they don't find a proper apartment, they rent a two room apartment and sign the lease. Any then may be next month they find some one to share a room and collect half of the rent from the newcomer. It is not rental income.
2007-11-02 04:21:56 · answer #1 · answered by MukatA 6 · 0⤊ 0⤋
It doesn't matter whether you rent or own. If he's just contributing his share to household expenses, then it wouldn't be taxable income or have to be reported to the IRS, he's just sharing the expenses.
If you owned a house and rented it to him, then that would be taxable income.
2007-11-02 03:06:08 · answer #2 · answered by Judy 7 · 2⤊ 1⤋
From the way you describe things, you are just sharing expenses. That's not considered taxable income by the IRS.
2007-11-02 03:14:16 · answer #3 · answered by Bostonian In MO 7 · 2⤊ 1⤋
i am going for the duration of the comparable factor now that my husband is disabled. definite they're going to count quantity your earnings and all sources. I in simple terms bought certainly one of our vehicles (an older one) by way of fact SS seen it an asset. My SON replaced into residing with us for a short at the same time as and so as that they counted his earnings even nevertheless he replaced into no longer ingesting here and attempting to save to flow out. Now i'm utilizing back and that they desire to have all reciepts and economic business enterprise statements proving the place I genuinely have spent funds that replaced into in the economic business enterprise and that i made out of the sale of the automobile. Your mom does no longer be waiting to arise with the money for residing on her very own in spite of the fact that if she gets SSI. it may be this form of measly volume that it may be of no help. She could prepare for government housing. i understand a woman who does not artwork and lives in government housing and could pay very little or no a month. yet those places are often in the ''initiatives'' or undesirable neighborhoods. the guideline for SSI is which you're allowed to have $3000.00 in sources. you're allowed one automobile. they're going to count quantity all earnings the economic business enterprise and you funds too and all shares, CD's, land and so on. something it is nicely worth funds they're going to count quantity as an asset. in addition they're going to count quantity your earnings while you're utilizing for foodstamps. it fairly is diverse if your mom will pay lease. I doubt it nevertheless.
2016-10-03 04:24:18 · answer #4 · answered by ? 4 · 0⤊ 0⤋
All income that is receive worldwide is consider for income tax purposes.
2007-11-03 01:30:43 · answer #5 · answered by Gary 5 · 0⤊ 1⤋