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About John Stancil, CPA
Expertise
I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I teach tax and accounting at a small church-related college. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a part time tax practice for over 30 years. I am a member of the AICPA, National Association of Tax Professionals, and the Institute of Management Accountants. Visit my website at www.johnstancilcpa.com. Also visit my blog, www.thetaxdocspot.com.

Experience
I hold a doctorate in Accounting, and four professional certifications: CPA, CMA, CFM, and CIA. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I write a monthly tax column for the local newspaper. I have prepared taxes for over 30 years.

Education/Credentials
DBA University of Memphis MBA University of Georgia BS in Accounting Mars Hill College

You are here: Experts > Business > Corporate Law > Tax Law (Questions About Taxes) > tax treatment of services that may include housing

Tax Law (Questions About Taxes) - tax treatment of services that may include housing

Expert: John Stancil, CPA - 11/6/2009

Question
An individual may provide property management, maintenance and repair service to me at an apartment building as an independent contractor. To carry out the services, he ‘would have to’ live in an apartment at the building where he would provide the services. Part of the fees he would earn could be used to offset rent. Would income from this arrangement be reported on a 1099? If so, would the 1099 include the ‘value’ of any or all of the rent or would there be an offset if the contractor is required to live at the property to carry out his responsibilities? What structure of such an arrangement would be most ‘tax favorable’?

Answer
Ken,

Thanks for your question.

First off, under the arrangement you have outlined, he would not be an independent contractor, but an employee. Since he is providing management services and is required to live on premises, any attempt to classify him as an independent contractor would run afoul of the IRS.

If the lodging is required as a condition of employment it is not taxable income to him. However, if the housing is provided in lieu of income, it is taxable.

Hope this helps.

John Stancil, CPA

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