I have a home that my sons live in. They pay the mortgage, nothing more. Should I consider it a rental property even though I don't make any profit?

philipwyble · ‎January 27, 2022

TomD8 · ‎January 27, 2022

No. When family members live in your second home and don't pay FMV (Fair Market Value) rent, that is considered personal use of the property.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.

LeonardS · ‎January 27, 2022

No, you should not consider the home as a rental property if it is not your intent to make a profit from the home.

If you should decide to turn the home into a rental and have your son rent from you the IRS requires the rent to be fair market value (FMV). Fair market rent (FMR) is the monthly rent a particular property type is likely to receive. Fair market rents are determined by the property's size, type, and location.

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I have a home that my sons live in. They pay the mortgage, nothing more. Should I consider it a rental property even though I don't make any profit?