Both are taxable, but educational and medical expenses are gift tax exempt.
Letting immediate family live in a house that you own and use is generally not considered taxable. Buying a house for someone else to live in, and just putting it in your name on it, would definately be taxable. Since you are not giving them the house, you will be liable for gift tax on the value of renting the home.
Remember that the gift tax exemption of $12,000 stacks.
So, if you are married, both you and your spouse can give your daughter $12,000 tax free for a total of $24,000 each year. (Gifts between you and your spouse are tax free)
Also, if your daughter gets married, then you and your spouse can each give $12,000 to your daughter, and each give $12,000 to your daughter's spouse, for a total of $48,000 each year.
Then, let's say your daughter has a kid. Now, you can give the normal $48,000 to your daughter as described above, plus another $24,000 that can be used for a trust fund for your grand kid.
This whole time you can be paying the medical insurance of your daughter and her family, and any college expenses they have with no tax penalty. Medical insurance could easily be another $6,000 a year that is tax free, and college education, might be $10,000-$30,000 a year.
With being able to give that much away per year, you should be safe,but if not, remember that you get an additional $1,000,000 exemption.
Thisexemption means that you get to give away up to $1,000,000 beyond theannual exemptions through the course of your lifetime before beingtaxed.
Your spouse also gets a $1,000,000 exemption.
Still not enough tax avoidance? Sign a notarized agreement BEFORE you win, with your daughter that says that she pays 15% of your lottery entry costs and will also receive 15% of your winnings. (or whatever percentage you want)
This will irrefutably prove that you had a pre-existing agreement to share winning and allow you give a certain percentage of the winnings away, without any chance of paying a gift tax.
Whether you actually charge her $0.15 cents for every ticket you buy is up to you, but the IRS will never know.
The problem with this type of agreement is that you will have no control over the winnings going to her if she is having an unstable time in life or if you have a falling out.
An example of this is the two women who grew to hate each other, but still had to share their winnings, because of a many many year old agreement.
If you do make an agreement like this, make sure that it is not open ended, and does specify a date range.