In-law apartment rented as not for profit

Forum|Forum|4 years ago
April 9, 2022
10 replies
50 views

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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sjrcpa

Level 15

You don't.

The more I know the more I don’t know.

M

mcd1231Author

Level 4

Sorry but I don't what? Enter on Sch 1 or don't claim the expenses?

M

mcd1231Author

Level 4

Maybe I should not have said rented. The daughter gives my client $$ toward household expenses.

Camp1040

Level 10

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.