bean29
Senior Associate
Joined: Dec 19, 2010 22:26:57 GMT -5
Posts: 10,273 
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Post by bean29 on Aug 10, 2023 9:32:08 GMT -5
I don't know if it's a state thing, but--and my mother uses my accountant--we have to put in what would be FMV for rent and pay income taxes on FMV even if we're not receiving the full rent. (I don't own a rental anymore, but used to.) So one of the things my sister says my mother said: My mother doesn't want to pay taxes on non-existent money anymore. Rental income goes on the federal return and also most states. The accountant for you and your mom is doing it correctly. Federal rules make you use FMV when renting to family members as they assume family is getting charged less than a "stranger". Rental income from non-family members is listed as what is actually paid. Idk, Turbo Tax tells me the FMV rent, it is a range. I think we are in the range. My DH always insists that we have to stay on the low end b/c there is a Huge Foundry across the street. When they are pounding steel the whole building shakes. He says for that reason, if he does not keep the rent low, the tenants will not stay. It is well known in the city that this is the case. The company has been known to pay to replace windows, although we have never tried to make a claim. |
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happyhoix
Distinguished Associate
Joined: Oct 7, 2011 7:22:42 GMT -5
Posts: 21,785
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Post by happyhoix on Aug 19, 2023 7:55:42 GMT -5
I’m guessing that your BIL wasn’t yet around when your mother offered your sister this arrangement. It’s crazy that two adults can’t come up with $500 rent/month. I hope they step up. Partly because if they don’t, and your mom passes, I’m guessing that your sister will insist that it’s “her house”, especially since (I’m assuming) you and your other sister both own their homes. (I know you do, my assumption is that the third sister does too.) Your mother has been very generous, for many years. It’s normal that she wants to put herself first now. She’s done more than enough for them. PS She may also be resentful because your mom already paid you for “her” house when your mom purchased it from you all those years ago.
I don't know if my sister realizes that I didn't get any money out of my parents buying that house from me. All it allowed was for me to not have to foreclose on it. I'd hope that she'd logically understand that after 15 years, living there for $500/month has gotten her way more out of it than I ever did. But, as indicated by this entire situation, she's not logical about money. I had a sister like this. Stopped working at 50 because she had ‘worked long enough.’ She thought double income couples ought to donate money to people like her. 😳 |
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happyhoix
Distinguished Associate
Joined: Oct 7, 2011 7:22:42 GMT -5
Posts: 21,785
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Post by happyhoix on Aug 19, 2023 8:08:58 GMT -5
From your moms point of view this makes sense. If she didn’t make this deadline tied to her granddaughter graduating HS your sister would never leave. Twenty years from now, when your mom passed away, she’d leave a problem for you and other sister.
I suspect your sister sometimes skips paying rent because she knows your mom won’t kick her out. Once she and her DH have to pay rent or get evicted, they’ll pay it.
Your mom did your sister a significant favor letting her have this sweet deal - but I doubt your sister sees it that way, unfortunately.
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laterbloomer
Senior Member
Joined: Dec 26, 2018 0:50:42 GMT -5
Posts: 4,355
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Post by laterbloomer on Aug 19, 2023 9:58:41 GMT -5
Your mom did your sister a significant favor letting her have this sweet deal - but I doubt your sister sees it that way, unfortunately. From what I have seen, if you do a favour for someone long enough or often enough they tend to forget it's a favour. It becomes something they are entitled to. It can be fascinating to listen to them explain how they are actually doing you a favor accepting whatever it is. In this case I imagine the sister explaining how she actually saved the mother money in property management. |
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happyhoix
Distinguished Associate
Joined: Oct 7, 2011 7:22:42 GMT -5
Posts: 21,785
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Post by happyhoix on Aug 19, 2023 12:06:09 GMT -5
Your mom did your sister a significant favor letting her have this sweet deal - but I doubt your sister sees it that way, unfortunately. From what I have seen, if you do a favour for someone long enough or often enough they tend to forget it's a favour. It becomes something they are entitled to. It can be fascinating to listen to them explain how they are actually doing you a favor accepting whatever it is. In this case I imagine the sister explaining how she actually saved the mother money in property management. Yes. Or arguing that she had to leave home early and wasn’t able to go to college so the cheap place to live was to make up for causing her to have such a poor start in life. |
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