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My client bought a house in 2021 and "rents" her in-law apartment to her daughter for a very affordable price. The daughter applied for rental assistance and it was issued. So my client received a 1099 Misc for the rent. I entered the 1099 Misc on Sch 1 line 8. How or where do I enter the expenses to offset this rental income? Thank you
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You don't.
The more I know the more I don’t know.
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You enter the 1099-Misc on schedule E not other income on schedule 1.. If taxpayer "rents" to a family member at below fair rental value then you file on schedule E and can only claim deductions up to income.
Well I like @sjrcpa answer better, claim the income on schedule 1 and interest and property taxes on schedule A, no other deductions allowed, just like a second residence.
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Sorry but I don't what? Enter on Sch 1 or don't claim the expenses?
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Maybe I should not have said rented. The daughter gives my client $$ toward household expenses.
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You claim the income and you do not deduct any expenses other than what is allowable on schedule A, mortgage interest and property taxes.
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"Very affordable price" and still needs rental assistance? 😶
Slava Ukraini!
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And the city/county/state pays your client rent.
The more I know the more I don’t know.
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That's the part that got me. Must have tried for PPP loans and didn't qualify ☹️
Slava Ukraini!
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She doesn't work. Not sure why
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I think it goes on Schedule 1 Line 8i.
The more I know the more I don’t know.
