Residential Rental Amount
Are there rules on a residential rental property with regards to the amount charged to the tenant. I have a single mom on disability that I want to rent a property to and it will be way below market. Does this impact the tax benefits for an investment property?
Every local and state has rules regarding renting residential property. It would be best to start with your local gov’t for a landlord/tenant rules document. Next it would be best to consult with a landlord/tenant attorney or real estate attorney to make sure that you are in compliance with all of the rules. And most importantly, if you have tax questions it would be best to consult with a local tax adviser or a CPA.
Unless your property has regulated rents, due to financing or subsidies received from a state or federal agency (e.g., HUD, RD, LIHTC, HOME), you can typically charge whatever you like for rent on your units. Reducing rent on a unit to accommodate a disabled person is allowable under the Fair Housing Act. However, the reverse is not. If you were to charge additional rent to the tenant based on disability you would be in violation of the Fair Housing Act.
As the prior commenter suggested, it’s advisable that you look into your local and state laws regarding rent structures, and consult a CPA regarding your tax questions.