Yes. This is income. Firstly, this wasn't your question, but your brother can't claim the mortgage even if paid directly to the mortgage company. To qualify to be able to claim mortgage interest, you need to:
- Own the home
- Be liable to pay the mortgage, and
- Make the payments
Then, there are two ways to handle this depending on whether he pays less than Fair Rental Value or not.
If he pays what would be a normal rent, you'll claim it as a regular rent on Schedule E:
https://ttlc.intuit.com/replies/3288530
If he rents for less than Fair Rental Value, see this:
https://ttlc.intuit.com/replies/5921388
