Parents managing & living in a unit & taxes

[Alice K.]

Hello All,

[I know this might be best for an attorney but before I go and find one, thought I'd ask the community in case someone has had this similar scenario.]

I am planning to buy a multi-unit (2-3) and have been analyzing properties heavily. I would like my parents to manage it in exchange for occupying a unit (10+ yrs exp in hospitality, hopefully this won't be too annoying and the one acquired is decent).

Question: For business tax (not LLC/C-corp, would be sole) purposes, should I put them on the title or mortgage? I realize I can do a lower down (but I want to avoid PMI, heck with that). I've been researching tax issues but for this scenario, their pay for handling things would be in free rent. Want to make sure this comes across in taxes so it doesn't look like I've just given away something. I could write out some document employing them for free rent but not sure how that might work atm.

Thoughts: 

Putting them on the loan may be silly because I have better credit I believe. So, unsure if a residential loan would be cheaper. 

Thank you in advance for any advice / stories of your own!