How is a Condominium / Apartment Building fiscally identified?
In such cases, it has a EIN, like any business would. Even absent the rent you suggest, the condo should have reserve funds, similar to an individual's emergency account, only more codified as to level and flows. These funds should be earning interest.
It's still is a problem because its illegal. Furthermore it has resulted in the decline of local businesses reliant on locals and not tourists.  Long term renters in areas that are not tourist dependent actually help the local area economically. It's actually vital.  No one is ripping off the landlord, the landlord gets a renter to host an illegal AirBNB location by subdividing a building or room well over capacity. This causes fire issues, clogs up elevators, behavior problems, etc etc. In my building they had to put up 7 notices on behavior, including partying, throwing trash out the window, smoking rules, pool abuse, making it actually a worser place to live. It's also negatively affecting the other people who own the apartment units they live in.  A building isn't a suitable hotel or BNB especially in big cities. I don't care if someone AirBNB's their spare room occasionally, but we're talking about AirBNB hosts who mass rent and then stuff 6 people into an apartment designed for 2 and then do it for many of the units in an apartment building. All of a sudden an apartment complex with 200 units designed for up to 500 people is suddenly host to 600+. You seem to underestimate the risk of this deal for the inverstors. A person purchasing a residence is happy to pay $70K instead of $150K now, and the only risk they take is that the construction company fails to build the condo. Whatever happens on the estate market in two years, they still saved the price difference between the price of complete apartments and to-be-build apartments (which by the way may be less than $150K-$70K, since that $150K is the price on a hot market in two years). However, an investor aiming to earn money counts on that the property will actually cost $150K in two years, so he's additionally taking the risk that the estate market may drop. Should that happen, their return on investment will be considerably lower, and it's entirely possible they will make a loss instead of a profit. At this point, this becomes yet another high risk investment option, like financing a startup. According to the New York Attorney General's Tenants' Rights Guide: Landlords, regardless of the number of units in the building,   must treat the deposits as trust funds belonging to their tenants and they may not co-mingle deposits with their own money. Landlords of buildings with six or more apartments must   put all security deposits in New York bank accounts earning   interest at the prevailing rate. Each tenant must be informed   in writing of the bank’s name and address and the amount of   the deposit. So you have to keep it separate, you can't spend it, and if you own more than six units, you have to put it in a bank account.  (The guide goes on to explain that the interest should be paid to the tenant.) "all the other answers are spot on, but look at it this way. really all you mean when you say ""building equity"" is ""accumulating wealth"".  if that is the goal, then having her invest the money in a brokerage (e.g. ira) account makes a lot more sense.  if you can't afford the apartment without her, then you can't afford to pay out her portion of the equity in the future.  which means she is not building equity, you are just borrowing money from her.  the safest and simplest thing for you to do is to agree on a number that does not include ""equity"". to be really safe, you might want to both sign something in writing that says she will never have an equity stake unless you agree to it in writing.  it doesn't have to be anything fancy. in fact, the shorter the better. i am thinking about 3 sentences should do the trick. if you feel you absolutely have to borrow money from her on a monthly basis to afford your mortgage, then i recommend you make it an unsecured loan.  just be sure to specify the interest rate (even if it is zero), and the repayment terms (and ideally, late payment penalties). again, nothing fancy, 10 sentences maybe.  e.g. ""john doe will borrow x$ per month, until jane doe vacates the apartment. after such time, john doe will begin repaying the loan at y$ per month...."" that said, borrowing money from friends and family almost never turns out well. at the very least, you need to save up a few months of rent so that if you do break up, you have time to find another roommate. disclaimer: i do not have any state-issued professional licenses." Should I treat this house as a second home or a rental property on my 2015 taxes? If it was not rented out or available for rent then you could treat it as your second home. But if it was available for rent (i.e.: you started advertising, you hired a property manager, or made any other step towards renting it out), but you just didn't happen to find a tenant yet - then you cannot. So it depends on the facts and circumstances. I've read that if I treat this house as a rental property, then the renovation cost is a capital expenditure that I can claim on my taxes by depreciating it over 28 years. That is correct. 27.5 years, to be exact. I've also read that if I treat this house as a personal second home, then I cannot do that because the renovation costs are considered non-deductible personal expenses. That is not correct. In fact, in both cases the treatment is the same. Renovation costs are added to your basis. In case of rental, you get to depreciate the house. Since renovations are considered part of the house, you get to depreciate them too. In case of a personal use property, you cannot depreciate. But the renovation costs still get added to the basis. These are not expenses. But does mortgage interest get deducted against my total income or only my rental income? If it is a personal use second home - you get to deduct the mortgage interest up to a limit on your Schedule A. Depending on your other deductions, you may or may not have a tax benefit. If it is a rental - the interest is deducted from the rental income only on your Schedule E. However, there's no limit (although some may be deferred if the deduction is more than the income) if you're renting at fair market value. Any guidance would be much appreciated! Here's the guidance: if it is a rental - treat it as a rental. Otherwise - don't. "What you are describing is a Chart of Accounts.  It's a structure used by accountants to categorise accounts into sub-categories below the standard Asset/Liability/Income/Expense structure. The actual categories used will vary widely between different people and different companies.  Every person and company is different, whilst you may be happy to have a single expense account called ""Lunch"", I may want lots of expense accounts to distinguish between all the different restaurants I eat at regularly.  Companies will often change their chart of accounts over time as they decide they want to capture more (or less) detail on where a particular type of Expense is really being spent. All of this makes any attempt to create a standard (in the strict sense) rather futile.  I have worked at a few places where discussions about how to structure the chart of accounts and what referencing scheme to use can be surprisingly heated!  You'll have to come up with your own system, but I can provide a few common recommendations: If you're looking for some simple examples to get started with, most personal finance software (e.g. GnuCash) will offer to create an example chart of accounts when you first start a session." If your landlord is OK with you subletting your apartment - then that's all that the landlord has to do with that. It doesn't really matter if the landlord is a private person or a publicly trade corporation/fund. No relevance at all. As to your own reporting - you're receiving rent. That is income to you. You can deduct the portion of your expenses (including rent) attributable to the area you rent out. All this goes to your Schedule E. Any positive remainder becomes your taxable income. Any deduction must be substantiated (i.e.: you'll have to keep all the receipts for all the expenses you used for the deduction for as long as the tax year is open, which is at least the next 3 years after filing). 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