Thank you; this is very helpful information. If I am understanding correctly, you are suggesting that it would be easier to deal with this issue now by entering the duplex as two separate properties? Right now I've been letting TurboTax handle it as one property and it figures out the 50% expenses, deductions, etc. TurboTax has been doing this for the past several years for us.
So during 2016, we lived in one half and rented out the other for the entire year. During 2017, we will live in one half until October and then convert our half into a rental.
If it is going to be easier to deal with this in the future by splitting the duplex into two properties, can I make this change in TurboTax for our 2016 taxes without utterly confusing it? How would I do that?
Also, if TurboTax views the duplex as two properties and we eventually sell the property, how will we enter the sale? We will be selling just one property, not two. So I'm not sure how that would work.
