My mom gives me a monthly amount equal to 1/4 of our fixed living expenses (mortgage, utilities, food, etc.) She has a MIL suite in our house. Should we file Schedule E and claim the income as rent and take the depreciation deduction for 1/4 of our living area, or should we claim the income as caregiving income? She doesn't have much taxable income, just CD dividends, the rest is non-taxable VA disability pension and SS. Not sure at this point if we can claim her as a dependent or not this year. Year before last we could, last year we couldn't. The main reason I want to even claim the income is so that should she need Medicaid in the future, I don't want her penalized for "gifting". She is able, and should, pay her share of expenses, but not sure how to handle it tax-wise. Yes I know I should probably hire a CPA but I was just seeing if anyone else is in the same situation and has any light to shed on what I should expect. Thanks!