A couple more questions for you:
If I convert the rental back to personal use to stop the depreciation, what happens to all of the expenses they are incurring to get the house back to being habitable for rent?
Is this kind of the same situation as "house flipping"? I've a another client who does this on the side so I know how to account for his flips on the tax return.
In regards to the $43K in supplies, I will ask the clients to help me break it down a little better since we will have more time to classify whether it belongs in the Asset section or a true supplies unless you have a recommendation for taking a percentage? Since it would be an improvement to the property I already know it will be the life of the rental property of 27.5 years. How specific do I need to be? I do not want to raise that red flag to the IRS. 🙂
I can always file the return and file an amendment even though I hate doing that. Ugh! Not sure if Turbo Tax allows this but you can reach me directly at jilrappe @ gmail . com. Any more help you can provide would be greatly appreciated!!