If your brother pays you $800 Rent and you pay your landlord $900, you would have a Rental Loss to report, for example, after entering Rental Income of $9,600 and Rental Expenses of $10,800.
However, if he is paying 'below market rent' this is considered personal use and is not deductible as a Rental Expense. According the IRS, "If you do not rent your property to make a profit, you can deduct your rental expenses only up to the amount of your rental income."
Obviously, it would not help you tax-wise to report Rental Income of $10,800 and Rental Expenses of $10,800, if this applies to you.
TurboTax asks you this as you go through the Rental Property interview.
Click this link for more info on Reporting Rental Income/Expenses.
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