Hi There! I am also a CPA and have some experience in how the state-sponsored programs handle rental income that is distributed to landlords such as yourself! Most likely, (and please reply to this post if this is not the case in your situation) - you have to fill out and file a W-9 Form with the State that is paying the rent on behalf of the roommate. This is so that the State has the information for you (as the landlord) with your social security number, address, and where the funds were sent, so that the State can send to you a Form 1099-G (which is a 1099 Form that shows the total amount of funds that the State pays to you during the tax year).
You will most likely receive the 1099-G from the State on or shortly after February 1, 2022. Once you receive this form - you will need it for your tax return filings.
In terms of filing - you will need to add a Schedule E to your tax return for 2021 - the year that you received these rental funds from the State on your roommate's behalf, and you will need to report this rental income/subsidy from the State as rental income on Schedule E.
The cool thing is that TurboTax Live! will ask you a few questions about the rental income, and also ask you about any expenses you incurred as a landlord, and you will just enter the information - and TurboTax Live! will do the rest. Please just keep copies of any receipts for any expenses that you had to incur that were specific to the rental arrangement that you have with your roommate!
We trust and hope that the response contained herein addresses your question - but please do not hesitate to contact us if you need additional clarity - and please do not hesitate to contact us to schedule a call with one of our Live Tax Experts so that we can answer questions about this Schedule E Rental Income!
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