any money spent on painting, cleaning, repairs, maintenance, & utilities (normally expenses) between the time it is purchased and the time it is ready for rent (placed into service) is classified as part of the acquisition costs (improvements) and is depreciated, not deducted, correct?
No. There is a difference between "acquiring" and "preparing". Cost associated with "acquiring" the property are added to the cost-basis and depreciated. Painting, cleaning, repairs, maintenance and utilities have nothing to do with acquisition of the property. Anything spent on "preparing" the property for rent after acquisition is just flat out not deductible. Period.
If I replace the appliances during that time, I can enter those separately, so the are correctly depreciated over 5 years, instead of 27.5, right?
You can. But I *highly* discourage it. With the exception of a hot water heater and a built-in under-the-counter dishwasher, appliances such as stove, refrigerator, washer, etc. qualify for the safe harbor de-minimus if the cost is under $2,500. So you can just expense the replacements when that time comes. The cost will be under $2,500 too, because there's no way on this green earth that a landlord with at least one brain cell between their ears will put an appliance that costs more than that, in a rental property.
For insurance, real estate taxes, and mortgage interest, do you have to prorate that between depreciation (for the time between purchase and put into service) and an expense (for time after it was put into service)?
No. If between the date of purchase and the date place in service the property was not classified as your primary residence, 2nd home or vacation property, then it's 100% business use from the moment you signed the closing contract at the sale. For example, a property can be classified as residental rental real estate on the date you close on the purchase, but not place "in service" until say, 2 months after when you have it move in ready. So cost incurred between the closing date and the in service date "preparing the property for rent" are not deductible. Period. Just don't confuse those non-deductible "getting it ready to rent" costs, with property improvments. Two completely separate and unrelated things.
For Loan Origination Fees, do they start at time of purchase or date the property was put into service?
I can't remember. But those are loan acquisition costs, not property acquisition costs. Loan acquisition costs get amortized (not capitalized) and deducted (not depreciated) over the life of the loan. If done correctly the loan acquisition costs will appear as a separate line item on only the 4562 titled "Depreciation & Amortization Report" for that property.
Remember, capitalized/deprecated costs get recaptured and taxed when you sell the property. Whereas amortized/deducted cost are not recaptured. They are flat out deducted. So when you sell, any remaining amortization left to be deducted in the tax year you sell, get completed deducted in that tax year you sell.
