I have a similar situation. I thought I had it figured out till I saw this thread. As a result I've decided to learn more, file an extension and send them an estimate of capital gains.
The house became vacant in November 2018. I did a total remodel. New kitchen, master bath, interior and exterior paint, new deck, new roof, and repaved the driveway. I didn't finish and close till August 2019. Had one sale fail and had to endure double house payments all that time. While rebuilding out of pocket.
What's the best way to reduce my tax burden? I was planning on treating it as a rental and take repairs as deduction. That appears wrong based on this thread.
I did a lot of the work myself with the help of a buddy who is a contractor. The rental was over an hour from my residence so more than a few times I worked all day and spent the night to get an early start in the morning.
Did I inadvertently convert it to personal use?
I'd appreciate your feedback.
