Follow-up question for you ColleenD3: I share my house with a friend, and other than our individual bedrooms, she has full use of the house/garage, etc. I'm not trying to make a profit apparently this would fall under Not For Profit, of which rental income to be reported on Schedule 1. And it is clear that you can offset that rental income with RE taxes, mortgage interest, casualty loss per the publication. But, I am confused a to where sharing expenses (utilities, pest control, yard mtg, etc.) comes into play. I charge her $550 for "rent" which is way below FMV. Her 50% portion of the expenses is around $500 a month. One person said I had to report the entire $1050 as rental income... that I could offset that with RE taxes and insurance, but NOT utilities. I don't see anything in the not for profit section that says I can offset the entire $1050 with utilities/expenses, but this really does not make sense to me. If this is true then my rental income would be very inflated and I would be taxed on her portion of utilities/expenses she paid me. Any advice you have would be appreciated.
