All Forum Posts by: Ross Slane

@Luke Carl I just purchased that book based on your recommendation and look forward to reading it.

@Joe Splitrock Thanks for the advice. I didn't realize until recently that I might need to be reporting this as income, but I am now reaching out to CPAs to help me figure this out. I agree that I need to be doing this the right way.

Thanks for the responses! You are correct, I haven't reported it as income and they just Venmo me. We have always seen it as friends sharing our housing costs and I didn't think about it in terms of income until recently. I was still seeing it in the mindset of when we shared an apartment and split rent.

I have been trying to figure out if reporting it as income is necessary and worth the extra hassle. I also was concerned that since their share of utilities/internet etc is included in the payments they send me, that I would pay income taxes on what is going toward those expenses.

For context:

Mortgage: $1100

Cost of mortgage plus utilities: $1500

Roommate 1 rent: $450

Roommate 2 rent: $400

My share: $650 (because I take the master suite)

My brother is living with me while he tries to get on his feet in a new city, I don't exactly charge him rent but he gives me $300/month voluntarily out of appreciation, and the plan is for him live here permanently and formally pay rent (a higher amount) once he sells his out-of-state property. But I could include his contribution in a lease if it would help my DTI.

And I don't think they would be weird about signing a lease if I asked. We have built a lot of trust over the years and they know I wouldn't be unfair, just as I know I have nothing to worry about with them as roommates/renters.

I currently own my home and share it with three roommates who pay me rent. They are all long time friends and like family to me. One roommate has lived with me for 6 years, the other for 4 years, and the third is my brother who has lived with me for about 9 months. It is pretty informal and we treat it as all of us sharing living expenses (split the mortgage cost and utilities with some adjustments for living space and my costs in acquiring the mortgage). We previously shared an apartment, then I bought a house a year ago and we all moved into it. They are all very responsible and never cause any problems or have issues paying rent. My mortgage costs $1100 and they pay me a total of $1150 (I take care of all the utilities).

I am saving money aggressively to afford a down payment on a rental property, probably in the 80k-100k range.

My question is this: Now that I am trying to get into the real estate investing game, will having a formal lease agreement for this make it easier to get financed for my first investment property. 

Also, will it be advantageous as far as taxes go?