Investors & landlords

Question 1 - If your rental space changes from year to year, then you will need to keep track of that percentage change in the rental space.  Your basis with regard to the space that was formerly rented, but currently is not, will adjust lower because of depreciation.  For example, if ten percent of the space is no longer being rented, then if you were to sell the home, that ten percent of the former rented space will have one basis, while the remaining 90% of the home will have another.  The more your rented space changes from year to year, the more complicated your calculations will become.  

Question 2 - Yes, provided the part of the home you live in was your primary residence for the period of time you listed in your post.  However, this only applies to the section of your home that was your personal residence.  The rental part is treated differently for tax purposes and is treated differently in TurboTax.  Here is a link to a TurboTax article that discusses how to report the sale of a rental property in TurboTax.

I sold my rental property.  How to report that sale.

Question 3 - No, if you need to amend a prior year tax return to add the missing depreciation, then go ahead and amend.   You want to have an accurate tax return.

Question 4 - You should use the square footage of the space you are renting.  Whether that square footage involves multiple rooms or just one room, it is best to use square footage as that number will be most accurate description of your rental property.  

Question 5 - It is not clear how landlords are basing utility usage based on the number of tenants.  Perhaps the rental unit does not have separate metering.  It is up to you how you want to allocate the utility usage; however, whatever method you use, it must be accurate for tax purposes.  In some cases, landlords may just charge a fixed amount for utilities.  Discussions of this type can be handled during the rental negotiations.   

While your rental unit(s) remains unoccupied for lack of tenant, if your intent remains to rent the unit, then for tax purposes the property is considered idle property.  You can, and should, continue to deduct the expenses associated with the idle unit, such as utilities, property taxes, depreciation, etc. 

Question 6 - It is not clear why that is happening.  Sometimes in the amendment process, tax entries will not update until all of the information has been entered.  Nonetheless, it appears you have a very good understanding of what needs to be done and why.  Thus, continue with your changes and should something appear amiss, you can post additional questions.

@GreatUncleSam