Condo Rental Property - Daughter Lives There

[beagle bev]

My daughter is living in a condo that my husband and I bought as a rental property. The condo is in the same town as the college she attends. We decided to let her live there rather than pay costly rent for an apartment for her to live in. We receive $.00 rent. Should we show that she pays some amount of rent. We pay for all the expenses, repair, utilities, phone, etc. Can we still right off all the expenses. Do we need to have her sign a lease? We want to be able to write off all expenses, to include taxes, insurance, etc.

Please advise.

 

[HomeGuru]

<BLOCKQUOTE><font size="1" face="Verdana, Arial">quote:</font><HR>Originally posted by beagle bev:
My daughter is living in a condo that my husband and I bought as a rental property. The condo is in the same town as the college she attends. We decided to let her live there rather than pay costly rent for an apartment for her to live in. We receive $.00 rent. Should we show that she pays some amount of rent. We pay for all the expenses, repair, utilities, phone, etc. Can we still right off all the expenses. Do we need to have her sign a lease? We want to be able to write off all expenses, to include taxes, insurance, etc.

Please advise.

<HR></BLOCKQUOTE>

Sign a lease and collect rent (even a little) as you should have income to offset the expenses and manage the property as a true rental unit. If there is no rent collected, you may have a problem with filing the expenses on the IRS Schedule E because the property would not be considered rental property. Double check with a CPA or IRS to be sure.

[This message has been edited by HomeGuru (edited August 11, 2000).]