I have recently sold a non-owner-occupied single-family rental property. It was rented for a number of years. At no time did I ever live in the home. In 2024 there has been zero rental income as I rehabbed the property for sale. My questions are related to the expenses of ownership incurred in 2024. I assume that the expenses itemized on the Settlement Statement will be deducted from the sale price. I also assume that the cost of my improvements to the property will be added to my depreciated Cost Basis in calculating my net gain on the sale. How do I treat the Utilities, Property Taxes, Insurance, and other expenses (not improvements) incurred this year as owner of the property? Are these expenses treated as a cost of sale? Are they added to my Cost Basis? Are they reported on Schedule E for 2024 personal tax return even though there was zero rental income? Thank you.
