DianeW777
Expert Alumni

Business & farm

The purpose in putting it in box 3 is to eliminate rental income since you recognize this as a reimbursement. If you prefer, you can enter it as rent (box 1) then enter your '14-day rental rule' under 'Other Expenses' on the Schedule E instead of 'Less Common Income'.

 

Either way will accomplish the same end result if these are the only two entries. 

 

Please update here if you have more questions.

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