If you are renting a room in which you are living and the renter does his/her tax return and claims on the return that he/she paid rent to get rental credit then there is a posibilty that State will question the income you received by renting a room. This is true for CA. On CA form 540 there is a form to be filled to claim rent. A single tax payer gets $60.00 and Married filing joint return gets $120.00 as credit. This credit is non refundable for CA state. To avoid this situation the renter should not claim the credit.