Paying Rent to Ourselves

[Tracey Lane]

We co-own a triplex with my parents with an attached finished garage that we currently use as an office space for our design business (S-Corp). The S-Corp is a separate and unrelated entity and the property is owned by us as individuals. Is there any reason to charge our S-Corp rent vs. just using the space rent free? We have rented the space out in the past to outside tenants. We were told the benefits would be that our business would get to deduct the rent we pay, and that it would make the property look better from an income perspective if we ever wanted to apply for a loan and use the property as an income source.

Thanks in advance!