We are changing our second home to rental use in January. In the previous year, we had expenses to outfit the kitchen (utensils, toaster, coffee maker, mixer, etc) and bedrooms (bedding, mattress covers, window curtains, etc) to get it ready for rental use. We know we can't expense these items since they were purchased last year. But can we add these startup expenses to the adjusted basis of our rental at the time it was is into service this January? If not, how would we account for these startup expenses. We plan on using Schedule E for expenses this year.
