and will show Days rented = 99, Personal use = 266 (rather than 0)
No. Days of personal use is days you lived in the property as your primary residence, 2nd home or vacation home *while the property was classified as a rental*. With a conversion date of 4/10/2022 you'll have ZERO days of personal use, because you did not live in the property as your primary residence, 2nd home, vacation home, or any other "personal pleasure" type of use at any time during the tax year. EVen if you lived in the property during the upgrades/work being done so that you could either do the work, supervise or manage it, that does not count as personal use days because "personal use" was not your primary reason for being there.
I also paid about $8,000 worth of other co-op fees (HOA fees) during the 2022 remodeling phase.
Typically, HOA fees are just flat out not deductible for the period of time the property is classified personal use. Just like the pro-rated amount of property insurance is not deductible for the period of time it's classified as personal use. Never has been to my knowledge. But I do hear of people that add it to their cost basis at the time of sale. Weather they get called out on it or not, I don't know because it's not like they brag about it. Your call.
I wonder if you'd be better off including at least some of it in the improvement costs for the months the work was on-going. Either way, it's adding to the cost basis.
On a side note, $8000 for HOA fees in a year? That's so far beyond what I would consider acceptable for any HOA. For two of my rentals. For me, the HOA fee is $30/mo for each rental. For the house I live in it's $50/year.
I can see a significantly higher amount for a multi-unit condo association type of HOA though, as the HOA would most likely be maintaining the outside of the structure, and a new roof isn't cheap.
For my rentals HOA I've gone down a few times over the last 25 years to look at the books. They take in close to $1M a year in fees. Of that, per the HOA bylaws they're required to set aside about 10% for "unexpected situations" and the rest is used for office fees (which are meager in comparison) and common area maintenance. About 20 years ago there was an "unexpected situation" when the entire filtration system in the community pool had to be replaced. Covered from the set-aside account with no assessments necessary.
There was one year where the set-aside account exceeded the maximum allowed by the by-laws. Per the by-laws, the excess is to either be credited or refunded. But that year the membership voted to allow the excess to be invested in the market somewhere for one year. The return was so good, HOA fees were cut in half the next year and those W-2 employees in the office (less than 10) all still got their yearly cost of living raise.
Now while I'm still "in" that HOA, I'm not as active with it as I was when I lived in the community (before moving and converting the property to rental). But when I moved out back around 2003 monthly dues were $20/mo, whereas now they're $30/mo and have stayed there for the last few years. One of the better HOAs I've ever dealt with or heard of.
