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?

  • 2
    Isn't your MIL just paying part of the mortgage on the house that she and your wife own jointly? – quid May 4 '18 at 16:50
  • 13
    Assuming that none of the parties are taking business deductions from this, who is to say that your MIL, a residing family member , isn't just contributing to household expenses? The ultimate answer is that you should consult your accountant to see if tax law where you live applies. – Bob Baerker May 4 '18 at 18:32
  • 3
    MIL is giving money to you to cover house 2 that she partially owns. No issue there. – JTP - Apologise to Monica May 4 '18 at 20:38
  • 2
    Even if she was just giving you money for no reason at all YOU wouldn't owe taxes. She might. – JohnFx May 5 '18 at 0:29
  • 3
    @tom I'd be surprised if her giving you money gave rise to a tax liability on her part. – Lawrence Dec 12 '18 at 11:06

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.


| improve this answer | |

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.