I have a similar situation. I own the house and have 3 roomates. H&R Block said that because I own the house everything the roomies spend on expenses is income to me. Of course, I then get to take those expenses off my income tax, which is good as I have way too much withheld.
I own a 2d house filled with tenants who have roomies. The money they get from their roomies is not income for them because they do not own the house.
I’m not an expert on this. I’m just telling you my situation. It is unfortunate that taxes are so onerous that decisions have to be based on gaming the complexities of the tax code. We need a flat/fair tax for the sole reason that economic decisions will be based on what is most productive and not on the tax code.
My personal recommendation is to rent to roomies. At least in IL the rental and roomie market is very strong. Another personal recommendation: Alcohol/drug use is the #1 filter to avoid bad tenants/roomies. #2 is people who not on the government dole. Rooming with a drinker or parasite is not worth the hassle.
You also have to depreciate the house if you have tenants...which is not a good thing if you plan to sell.