No, you do not state that you converted it to a rental in 2017, however you must report the income that you received from renting the basement in your home. You are allowed to deduct expenses associated with renting the basement in your home.
Expenses for your entire home must be divided between the part you rent and the part in which you live. This includes payments for:
- mortgage interest
- repairs for your entire home—for example, repairing the roof or furnace, or painting the entire home
- improvements for your entire home—for example, replacing the roof
- homeowner's insurance
- utilities such as electricity, gas, and heating oil
- housecleaning or gardening services for your whole home
- trash removal
- snow removal costs
- security system costs, and
- condominium association fees.
