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Good afternoon. This is a gift and not income so there are no income tax consequences to you. Also as a gift, there should be no gift tax
consequences. Recipients of gifts are not subject to gift tax. And, there should also be no gift tax due from the donor. Each donor can give $14,000 per year per person under the annual gift exclusion. In addition to that, each person has a $5,120,000 lifetime exemption....which means a person can give a cumulative amount of up to $5,120,000 in gifts without incurring gift tax....the donor must file a gift tax return
to let the IRS
know how much of the lifetime exemption is being used, but there will be no gift tax until cumulative gifts have exceeded the $5,120,000. You can simply allow them to live in the house for no cost and would not need to charge them rent. If they pay the expenses, you can just treat those as reimbursements
and you would have no issues with not dealing with this on your tax return
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