I rent out two rooms in my home. Currently we split the utility bill between 3 people, i.e. the utility bill is in my name, and I pay the utilities and then get reimbursed for the other two thirds by my renters/roommates.
What is the best way to deal with this from an income tax perspective? Do I need to report the reimbursement as rental income (in addition to the base per-month rental income I am receiving)? In that case, would I then be able to consider the 2/3 of the utility bill a business expense? Or am I okay handling this in an informal way, without recording the utilities as a business expense, and the reimbursement as income?