Practically speaking, the Internal Revenue Service is not in the business of measuring everyday exchanges of property between family members. Just as gift tax returns are not expected to include the value of Thanksgiving dinner, etc. provided at your home, gift tax returns do not have to be filed to declare the fair rental value of having your adult child occupy his or her old room again.
Likewise, if you have an informal arrangement in which your adult child pays you some "rent" each month while back home, you typically wouldn't declare it as taxable income. In fact, if you do so and you then attempt to offset it with depreciation and other deductions to create a loss, that will get the IRS's unwanted attention. As long as cash payments back and forth don't exceed the $13,000 amount required for filing a gift tax return, nothing typically needs to be done.
---Steve
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