If you charge a higher rent because of the change in the make up of the household, you may find yourself in violation of fair housing laws.

Even with kids in school and you working 50-60 hrs a week I would say your wife is already working full-time taking care of family and household needs.

Please tell me,,,,  "How many folks in your household?  

I had a similar case  where the head of household passed.

The IRS penalties are only around 4% as I recall (I actually know a couple people who did this during the recession so they could buy homes), and they're great to work with on payment plans.The IRS will send a letter to your employer saying what your W-4 filing status should be (for instance single, head of household), saying you aren't allowed to change that until you have paid back what you owe the IRS, and you will also agree to that with the IRS.If you start now, you could have a year and a half or so of being able to do this before the IRS gets in contact with you.Just remember you will have to pay it back and budget for it. 

@Ryan Scott IsacksenIt’s a condominium in San Francisco

Talk to her in person about your concerns, then do it in writing and have her sign it.Something along the line of the "washer and dryer are designed for clothing and other normal household items and are not for larger commercial type products.

We require monthly gross household income to be at least three times the monthly rental rate.

Apparently lot's of Asian families in the area with multi generational households, so perhaps I can find one family who is looking for such a setup.

My intention was to give the apps to all adults in a household if they are interested in the property.