no - income is income, regardless of the "market value" of the rental. Consult an accountant or a tax attorney on this.
I report all of the income on my owner-occupied 2 unit because i can depreciate 1/2 of 1/27th of the purchase price and because I pay the utilities, I can deduct 1/2 of the utilities, I also deduct other things as rental expenses such as 1/2 of the property taxes, 1/2 of repair costs to common areas...etc...if i did not report the income, not only would I be committing a crime, I would not get the tax benefits of owning a rental property.
Before you take advice from this board (which is usually really good advice) consult a professional, pay them a little for their guidance, and get the confidence that you need to make sure that you are legally and financially making the best choices (not to mention the guarantee that comes with their malpractice insurance).