Does my living in the cabin while renovating for an extended period (see COVID) have any effect on my ability to qualify my expenses once I do rent it out? Yes I think you do. It's not possible for me to distinguish your situation from a situation a person buys property, make repairs and improvements and the n after several years rents it out.
my opinion is that the soft costs incurred, repairs tools etc, are a personal expense. hard costs become costs of the property like furniture, appliances, new flooring, etc.
when you convert the property to rental the basis for depreciation would be the lower of your capital costs (excluding land) or the FMV of the depreciable portion of the property. the issue is are you allowed to separate the cost of the building from the costs of appliances, etc. I believe the answer is yes.
however, since this is a conversion from personal use and residential property things like appliances and furnture would have to be depreciated over 5 years. Neither 179 or 168(k) would apply.
startup costs (IRC 195), to the extent deductible (you know the $50K rule), can not be deducted until the business begins.
start up costs include
advertising
consulting or other fees paid in connection with the starting of the business
travel and related expenses to secure suppliers and customers.
