Personal Finance & Money Asked on December 2, 2020
This is for California, USA
My MIL is living with us these days and we do not actually charge her for any rent. She has a small business that has sporadically yields some income. She insists on paying us with that money as my wife is paying for the mortgage on a house (separate from the one we all live in, which is owned by me) they (wife and MIL) own jointly. The amount would be between 10k to 15k a year.
How does this work in terms of taxes? Do we need to report the money MIL gave us as “rent” money?
Wait, are your MIL and Spouse both co-owners, and it's the primary residency for your MIL correct and not your residency? Is your wife handling the money for your MIL? How much mortgage does she (MIL) pay, and you (your spouse/you) pay in %.
If she pays 100% of her own mortgage, then provides you the 10k-15k; then it's clearly a gift, and it's subjected to tax.
I think the case is this >>>> Double Check against "Gifted Money", follow the link below to the IRS website, and see if it applies to your situation.
Answered by Laythesmack on December 2, 2020
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