Living In A Corporately Owned House
We are currently living in a home that we are rehabbing but it is owned by our corporation. The private mortgage is paid out of our company. How should we report this on our corporate books and our 1040 at year end? Are there any imputed rental income rules that we need to be aware of? Any court cases that we need to be aware of? Thanks for any help or suggestions you can offer. We have been in the home 5 months. Thanks!
If you are paying rent to the corp, the corp would show rental income. If you're not paying rent, a W-2 should be issued to you by the corp for the FMV of the rent (FICA taxes apply) and the corp would show rental income and deduction for W-2 wages. The corp would also deduct expenses related to the house.
There are some situations where companies can provide housing to employees without it being compensation but those are very limited (emergency personnel, offshore oil rigs).