@Carl -- I also have a very similar situation so much of your reply to the initial post is helpful, but let me toss these several nuances of difference:
1. Have owned the vacation rental property since 2015 and on 12/1/22 we asked the management company to not rent it out for the next 2 months (Dec and Jan) because we were doing a bathroom remodel. Some of the work was paid for in 2022 and some in early 2023. These are certainly property improvements for which I'd like to add to my costs basis. Assume I'd have to split the reporting between 2022 and 2023 because actually paying was split? But here's the real issue:
2. We sold our primary residence in 2022 and have determined that to not be tax reportable -- and we decided to move to our vacation rental as our primary residence in February 2023. I am wafflng about converting it in 2022 or 2023. At first I wasn't going to deal with converting the vacation rental to personal use until 2023, but after reading your comments to the other post I'm wondering if we should go ahead and covert it to personal use in 2022, even though we didn't move in until 2023?
3. To complicate further, we also had $20k worth of HOA-required property improvements we paid for in 2022. I know based on your reply to the poster who was SELLING his property, you recommended he not depreciate the improvements because he has to recapture all the carryover when it's sold. Is recapture issue the same when we convert to personal use but don't sell?
Need help in 1) treating the $20k HOA assessment paid for in 2022 (want to capture the add to cost basis and not sure if to depreciate), 2) for bathroom remodel improvements paid for in 2022 and 2023, how should report those? and 3) Convert to personal in 2022 or 2023? Thank in advance for help!!!
