Family is the foundation of you: how your family interacts while you are young, how they interact with each other, and how they raise you helps mold your very being. Family is the one thing that can build you up, tear you down, and still expect you to help them at the drop of a hat. That includes when they find out you have a rental property and they expect you to let them use it.
Renting to Family is a Bad Idea
Working with family has its normal hurdles. The balance of being around them all day, treading lightly around workplace taboos, and having the standard Professional Respect around someone when you were there the day they “had an accident” in fourth grade is difficult. It’s made easier when working with family requires neckties and pressed button-downs.
Family is the foundation of you: how your family interacts while you are young, how they interact with each other, and how they raise you helps mold your very being. Family is the one thing that can build you up, tear you down, and still expect you to help them at the drop of a hat. That includes when they find out you have a rental property and they expect you to let them use it.
Renting to Family is a Bad Idea
Working with family has its normal hurdles. The balance of being around them all day, treading lightly around workplace taboos, and having the standard Professional Respect around someone when you were there the day they “had an accident” in fourth grade is difficult. It’s made easier when working with family requires neckties and pressed button-downs.
That’s not going to happen when family is renting from you. It’s hard enough to ask Grandma for money. She spoiled her grandbabies rotten, and probably expects some kind of ‘family discount.’ If not a family discount, then she may expect some kind of family leniency. That could range from allowing pets without fees, not minding delayed rent, shrugging off property damage, and a host of other issues. Once you’ve realized you’re in a bad way, you have to deal with a much bigger issue. How do you kick out Grandma?
That’s not going to happen when family is renting from you. It’s hard enough to ask Grandma for money. She spoiled her grandbabies rotten, and probably expects some kind of ‘family discount.’ If not a family discount, then she may expect some kind of family leniency. That could range from allowing pets without fees, not minding delayed rent, shrugging off property damage, and a host of other issues. Once you’ve realized you’re in a bad way, you have to deal with a much bigger issue. How do you kick out Grandma?
Scapegoat the Government
Of course, you want to help family! Family is the best thing ever, and of course, you understand that Baby Brother really needs the help, and of course, you know he’d be the most perfect tenant that ever did rent. You want to help, Aunt Betsy, really, you do. It’s the government that said no.
A good way to make sure they don’t hate you for kicking Baby Bro to the curb is to blame someone else. That sounds morally awful, let’s try blaming something else: personal use tax laws. When your rental property did not have family members staying there, it was clearly a business investment. With a family member, that gets more muddled. According to Forbes, “when you rent a home to a relative, such as a spouse, child, grandchild, parent, grandparent, or sibling, any day rented at less than the fair rental price is considered a personal use day.
This can completely twist your taxes, and suddenly, your rental property gets taxed as a second home. Try something soft and kind, with tones that say you want to help, you really do, but you’re no longer able to, unfortunately.
“I appreciate the situation and am glad that I’ve been able to help as much as I have. At this point, however, I can no longer afford to. The IRS has claimed this as personal use, and I can’t afford how that affects my taxes. I wish I could help more.”
If someone protests and suggests lying on your tax forms, you can blame the IRS and request that no one put you in jail over a few months rent.
Scapegoat the Government
Of course, you want to help family! Family is the best thing ever, and of course, you understand that Baby Brother really needs the help, and of course, you know he’d be the most perfect tenant that ever did rent. You want to help, Aunt Betsy, really, you do. It’s the government that said no.
A good way to make sure they don’t hate you for kicking Baby Bro to the curb is to blame someone else. That sounds morally awful, let’s try blaming something else: personal use tax laws. When your rental property did not have family members staying there, it was clearly a business investment. With a family member, that gets more muddled. According to Forbes, “when you rent a home to a relative, such as a spouse, child, grandchild, parent, grandparent, or sibling, any day rented at less than the fair rental price is considered a personal use day.
This can completely twist your taxes, and suddenly, your rental property gets taxed as a second home. Try something soft and kind, with tones that say you want to help, you really do, but you’re no longer able to, unfortunately.
“I appreciate the situation and am glad that I’ve been able to help as much as I have. At this point, however, I can no longer afford to. The IRS has claimed this as personal use, and I can’t afford how that affects my taxes. I wish I could help more.”
If someone protests and suggests lying on your tax forms, you can blame the IRS and request that no one put you in jail over a few months rent.
Stand Firm on any Guilt-Tripping
If you have a better way evict Uncle Dave and Aunt Martha, that’s fantastic! In fact, please, tell us how you did it in the comments so that we do not further anger Big Brother. All advice is welcome. The next step is to prepare yourself for the guilt trip.
Family is so good at guilt-tripping, so you do need to be prepared for this. There are many ways you can respond, whether it be turning the tables:
Stand Firm on any Guilt-Tripping
If you have a better way evict Uncle Dave and Aunt Martha, that’s fantastic! In fact, please, tell us how you did it in the comments so that we do not further anger Big Brother. All advice is welcome. The next step is to prepare yourself for the guilt trip.
Family is so good at guilt-tripping, so you do need to be prepared for this. There are many ways you can respond, whether it be turning the tables:
“That’s a great idea! You can do that when they stay with you!”
Agreeing while disagreeing:
“That would be splendid! If only I could afford to do that.”
Or taking it all as a joke:
“Hah! If only that were possible. You’re funny!”
By sticking to your guns, hopefully, they’ll get the picture, and you can pleasantly move on from there. Our fingers are crossed. You know your family best, so you can prepare beforehand with the things you think they will say and the best way to tailor your responses.
Laying down the Law
If they don’t get the picture, then you’ll have another problem. And that’s literally, laying down the law. Your best course of action is to make sure they understand the position you have put them in. If this is a beloved family member you still wish to have in your life, then obviously you need to do this as kindly as possible.
- The polite verbal conversation you had about the matter, where hopefully things end.
- It doesn’t end. Another conversation, where you are as firm as you can be.
“I don’t know if you realized this before, but I am at the stage where I need to have a different tenant on this property. This is my business and livelihood, and as much as I love you, I need to maintain this business in a professional, sustainable manner. This is my final, verbal warning because I love you, and I want this to go well.”
3. As soon as you’re done with the verbal conversation, prepare for the written notice.
Just because they’re family, doesn’t make the legal eviction process any differently. You can talk to them beforehand about what a real eviction would look like, and maybe it would scare them into getting out. The best thing to do is to make sure they know you don’t do this lightly. This is a last resort action, but one you feel forced to take, as the only other option besides bleeding money is to sell the property all together. No one wants that. Either way, they’d be out of a home.
“That’s a great idea! You can do that when they stay with you!”
Agreeing while disagreeing:
“That would be splendid! If only I could afford to do that.”
Or taking it all as a joke:
“Hah! If only that were possible. You’re funny!”
By sticking to your guns, hopefully, they’ll get the picture, and you can pleasantly move on from there. Our fingers are crossed. You know your family best, so you can prepare beforehand with the things you think they will say and the best way to tailor your responses.
Laying down the Law
If they don’t get the picture, then you’ll have another problem. And that’s literally, laying down the law. Your best course of action is to make sure they understand the position you have put them in. If this is a beloved family member you still wish to have in your life, then obviously you need to do this as kindly as possible.
- The polite verbal conversation you had about the matter, where hopefully things end.
- It doesn’t end. Another conversation, where you are as firm as you can be.
“I don’t know if you realized this before, but I am at the stage where I need to have a different tenant on this property. This is my business and livelihood, and as much as I love you, I need to maintain this business in a professional, sustainable manner. This is my final, verbal warning because I love you, and I want this to go well.”
3. As soon as you’re done with the verbal conversation, prepare for the written notice.
Just because they’re family, doesn’t make the legal eviction process any differently. You can talk to them beforehand about what a real eviction would look like, and maybe it would scare them into getting out. The best thing to do is to make sure they know you don’t do this lightly. This is a last resort action, but one you feel forced to take, as the only other option besides bleeding money is to sell the property all together. No one wants that. Either way, they’d be out of a home.
