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Lev
Lev, Tax Advisor
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Experience:  Taxes, Immigration, Labor Relations
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I have a roommate. I make him pay half of the lot rent of the

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I have a roommate. I make him pay half of the lot rent of the mobile home. I also was going to charge him for 1/2 of the rent for my storage unit. I told him that I would not have a room to let him live in if I didn't move all my stuff out into a storage unit. When I file my taxes, is it legal to consider 1/2 of the rent for the storage unit part of his share of the rent? I don't report his rent on my taxes because he just pays 'his 50% of the lot rent' which I don't actually collect. Its same here with the storage unit, though its only my stuff in it. I would have no room for him if I didn't keep it in that unit. Would I have to report the 50% of the storage unit rent I get from him as extra income even if I have no room to rent him a room if I don't keep it in a separate place?
Submitted: 10 months ago.
Category: Tax
Expert:  Lev replied 10 months ago.

Lev :

Hi and welcome to Just Answer!
If you are roommates - and each pay his.her share of common expenses - there is no rental income for you - and nothing is reported on your tax return.
Based on your information - you as a responsible person combine yours and your roommate's expenses in order to make payments to the landlord.
If you have a separate sub rent agreement - and collect rental income - the situation would be different - and such income would need to be reported along with rental expenses.
If your roommate pays separately for the storage unit which is used solely by you - that would be considered as your income.

Customer:

I realized that I said I don't collect it but I do. I get the Lot rent statement, divide it by 2 and ask him to give me a check in my name for that amount. I then write a check to the Landlord myself for the Lot rent. But I figured since we are splitting it 50/50 that it was ok and I guess by your answer it is. There is no sub lease agreement. But I am the one renting the Storage Unit, its in my name only. I pay the rent for that storage unit. I am asking my roommate to pay 1/2 of that storage unit rent. by your answer I guess I'd have to report that as rental income. Since I am renting at much lower then 'what normally someone would rent at' I assume just on line 21 of the return?

Lev :

If the storage unit is rented by you only under a separate agreement - but is paid partially by another person - we need to identify the reason you are paid. Based on your information - that is a part of sublease payment and that person pays you because he/she is your roommate.
If that is correct - you must include the full payment and deduct the amount you pay to the landlord for the part you subleased (not used by you personally). It will be reported on schedule E and net income will be reported on form 1040 line 17.

Lev :

Please see this publication, in particular section called personal use property or dual use property: http://www.irs.gov/pub/irs-pdf/p527.pdf

Lev, Tax Advisor
Category: Tax
Satisfied Customers: 22617
Experience: Taxes, Immigration, Labor Relations
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