The way to handle it is to allocate expenses based on the percentage of the home’s square footage used for rental purposes.Here’s how it works:Calculate Rental Percentage: Add up the square footage of both the in-law suite and the rented room, then divide by the total square footage of the house.Apply This Percentage: Use this rental percentage to deduct a proportionate share of expenses like repairs, utilities, and mortgage interest.This post does not create a CPA-Client relationship.

This can give you some tax saving that needs to be discussed with your CPA.

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C-corps often aren’t ideal due to double taxation (on both corporate and individual levels).This post does not create a CPA-Client relationship.

The cost basis includes:Purchase Price: The amount you paid for the property.Renovation Costs: Add the cost of improvements and remodels that significantly enhance the property's value.Closing Costs: Certain closing costs related to acquiring the property (like title fees) can be added to the basis.You will then allocate the total cost basis between the land (which isn't depreciable) and the building (which is depreciable over 27.5 years for residential properties).If you're unsure about how to allocate between land and building, you can use the allocation percentage from your property tax records or get an appraisal.This post does not create a CPA-Client relationship.

Not an attorney or CPA so cannot help on those items.

The JV agreement should make this clear.You may want to speak to an attorney and a CPA familiar with these transactions.

That would raise suspicion to me that they are not paying their appropriate taxes but I would check with your CPA about it.Using your money without consent, that is also a problem but that maybe part of something you signed.Frankly it isn't that much of a hassle once you get rolling.

You’d want someone as trustworthy as a CPA for your taxes!

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