Investors & landlords
It sounds like the property was 'unrentable' during renovations, so no, you converted it to personal use as soon as it was no longer available for rent (March 2022). You're correct, you wouldn't qualify as a RE pro.
There's no advantage to keeping it as rental property anyway, since the major improvements you did are all going to be added to the Cost Basis, as will be your refinancing costs and any other sales costs you incurred.
Your selling Cost Basis would be the original Cost Basis when you started renting, 300K (220K you paid, plus 80K improvements), plus the Cost of Improvements done before sale (you said 310K, plus Sales Expenses, less Depreciation Taken (which you can find on the last tax return where you reported rental income/expense), Form 4562. Add Prior Depreciation and Current Depreciation together for 'Depreciation Taken' total.
You will need to enter this amount when you report the sale in the 'Sale of Business Property' section, and Form 4797 is generated for you.
In the Rental section, in Property Profile and Asset/Depreciation, you could report 'converted to personal use' and the date last rented (March 2022), if you haven't done that already. It actually could be reported on an Amended 2022 return, or you could use the date of 1/1/2023 to keep it in this tax year.
You won't have any Rental Income in 2023 to apply QBI to.
If you end up with a Capital Loss, you'll be able to deduct at least 3K each year until it is used up.
