While I understand that rental income at a fair rental value is considered "rent" for the purposes of the IRS, is there a difference when the roommate is paying significantly less than the fair rental value that one would otherwise receive if renting a room out to someone?
To put it another way... Is the (significantly less than normal rental) cost-sharing amount considered as "rental income" in the eyes of the IRS? If not, what type of "income" would it be considered?
Is it even considered "income" at all, since it is simply splitting bills and other costs of living at a given residence?
I've researched IRS pub 527 and IRS pub 946, but the above still seems less than clear.
Any help would be so greatly appreciated. Thank you in advance for your time!
