Add the conversion amount to the basis of the house and depreciate an entire amount as described below.
To figure the
depreciation deduction, you must first figure the part of the cost of your home
that can be depreciated (depreciable basis). The depreciable basis is figured
by multiplying the percentage of your home used for business by the smaller of the following. The
adjusted basis of your home (excluding land) on the date you began using your
home for business or the fair market
value of your home (excluding land) on the date you began using your home for
business.
When asked for date purchased or acquired, enter that date. The program will later ask on what date you began using the home office.
Please see Pub 587 for more information.
https://www.irs.gov/pub/irs-pdf/p587.pdf
