I bought a new house and I've rented out a bedroom (the renters have full access to the rest of the property) the whole time. How do I file? Do I report the income?

[djlekl2017]

There were some expenses. Rent was paid in cash. It was below market value.

[LinaJ2018 · Accepted solution]

If you charged rent at below fair rental price, it is not considered as a rental property for business.  Instead, it is treated as a personal-use property, therefore, the income received is not considered as rental income and no expenses are allowed for deductions. 

However, you do need to report the income as other income on line 21 of your Form 1040.  

With the new tax reform TCJA, you cannot deduct any hobby expenses against your income because they suspended the entire section of the Miscellaneous deductions subject to 2% of the AGI.  

To enter income and expenses as a hobby, here are the steps:

In TurboTax online edition,

• After sign into your account, select Pick up where you left off
• At the right upper corner, in the search box, type in hobby expenses
• Select Jump to hobby expenses
• On-screen, Report Hobby Income and Expenses, enter information.
• Follow prompts

[djlekl2017]

I was wrong. Rent was low, but really just at the low end of market value. Does that change everything?