<prompt> Human: Throwaway for obvious reasons.During a discussion with coworkers, one of them shared that he doesnt pay rent. When asked about his situation, he mentioned that his parents let him live in their second home for free. The parents pay the mortgageproperty tax although it sounds like the property is paid off. No one pays any extra taxes on the transaction and he lives rentmortgage free.Is this legal? Do the parents have to pay gift taxes if they dont actually give him any money? Should the value of market rent get counted as income for him?Very confused as this situation sounds too good to be true.  <response>: Tens of millions of other parents do this too, they are helping out their kid - but as far as the governmenttaxes are concerned, they are maintaining an investment property. Your way overthinking this, are you hoping to get your coworker in trouble or something? 