I will be closing on the sale of my former primary home soon. If the closing happens when scheduled, I will barely qualify for the "2 out of 5 year rule" for home sale. In between, the house has been rented. Two questions for clarification:
1. I'm presuming I still need to do a Schedule E for the rent received/depreciation/expenses for the part of the year that rent was paid. Do all the property taxes for the year go on Schedule E, or do they go on itemizable deductions?
2. Since it has been rented for almost 3 out of the last 5 years, how do I figure the capital gain--use the adjusted basis or the depreciated value?
