BAH on National Guard Deployment, Renting from Parents. Ideas?

2023-02-27T20:26:00-05:00

I am currently paying discounted rent to my parents as I save for a house. I was recently notified that we will be deploying next year. I was hoping to collect BAH while overseas. Am I able to receive BAH if my parents and I sign a notarized lease even though they live in the same location and I am not on the utility bills? If not, are there any creative solutions around this? We have a second house in Atlanta and my sister rents a house to another one of my sisters in the same zipcode I currently live in. Any help would be greatly appreciated!

Response by 1LT Private RallyPoint Member made Feb 27 at 2023 9:56 PM

2023-02-27T21:56:13-05:00

I don't know what your family's properties have to do with the situation, BAH is for you and your dependents. Have you tried calling military one source? It probably best to talk to someone in finance, if not your local finance office, whatever that looks like for the national guard in your state.

Response by MAJ Byron Oyler made Feb 27 at 2023 11:25 PM

2023-02-27T23:25:36-05:00

Your parents can absolutely charge you rent to live there however the tricky side is not with DFAS as much as it is with their taxes. I am uncertain how they would show it as a rental on their taxes and show what you pay them as profit. Your best bet might be to use the sister's rental and she show what you pay her as profit on her taxes. If you are going to claim something for BAH the people where the money goes needs to be claimed as well.

Response by CPT Private RallyPoint Member made Feb 28 at 2023 3:27 AM

2023-02-28T03:27:29-05:00

As long as you have a lease you will be fine. You would have to just acquire a lease saying that you pay rent. You don't have to state that your parents live there. If that was the case then a duplex would have to list everyone else. Your lease could state that you rent the residence. I imagine that you have free reign in the house. This would basically be your parents renting you their house and staying with you as a guest in the house you are renting. You need to be cognizant that the IRS plans on trackings transactions that are over 600 dollars. Your parents would have to report this as income. Currently, the plan to do this has been paused but I am sure it will be coming soon. I doubt this income would do much to affect their taxes.

Response by CSM Darieus ZaGara made Feb 28 at 2023 7:50 AM

2023-02-28T07:50:21-05:00

Your personal belongings have to stay somewhere BAH should not be an issue, but you do require a legal document showing the contract/rental agreement/lease. It has already been stated that there is a tax issue. Your parents need to review the state laws associated with rental properties and income taxes. That should be an easy google. You may find that your gain is there loss. Unless of course you pay the tax for them. Or their finances are slid and they don’t care. Just a little homework may save sone grief.