Do I pay income taxes for renting a home at less than fair market value?

[Jjone]

I am moving to another state for 2 years for a job with the intent of moving back into my house after that time. We currently pay a mortgage on the house. We are planning on having a friend move in and will be charging significantly less than similar housing in our area and in fact it does not even cover our full monthly mortgage payment. 

I just want to make sure that this is not actually going to cost us more money. Will I be taxed on the "income" that I am earning from my friend even though it isn't a net positive?

[M-MTax]

At best you will only be able to deduct expenses to the extent of income and nothing more. So you can't generate a net loss.

[M-MTax]

Just as a primary rule every day you rent below fair market value is considered a day of personal use.

[Bsch4477]

If you rent your residence at below market value you have to report the income as regular income and not rental income and can’t take any of the deductions associated with rental property. You can continue to deduct mortgage interest and property tax on Sch A as itemized deductions. 

[LenaH]

Yes. As stated by Bsch4477, you must report the income as regular income. You will not have a Schedule E. Since you are considered not renting for profit, you must report this on Schedule 1 (Form 1040), Line 8j. Any deductions (real estate taxes, mortgage interest) are deducted on Schedule A. 

@Jjone