new carpets/floors, new counter tops would be an improvement?
Yes, provided you capitalize them. If the cost is less than $2,500 to have the option to either expense those items, or capitalize them. To reduce capital gains, you'd be better off capitalizing them. Can be done, albeit a bit tricky though, if the improvements are done after the last renter moves out prior to the sale, since the improvements are never actually placed "in service" after the last renter moved out prior to the sale.
