The way i read Publication 527, for 2021 I pass the test of "a dwelling unit used as a home". I think this is different from converting to an "investment property", but not sure?
Looks to me like you're not understanding the pub or are misinterpreting it. Bottom line is, the date you convert it to a rental, you can call it whatever you want, be it dwelling unit used as a home or investment property. The IRS says you report your rental income/expenses/depreciation on SCH E. You nor I have any say in that.
I used it 19 days, friends used it 48 days at a below market rent,
That period of time used by friends at below market rent is considered personal use days. So I suggest you consider it as such and not bother with reporting any of that time frame on the SCH E. Simply report any income received for that time as "other income" and be done with it. You also might be able to "get away" with reporting the income on SCH E as having been received after converting the property to 100% rental. That's what I would probably do, but that's not really right. Would be a problem if I were audited on it. But my chances of an audit are so low that I don't consider it a possibility really. But then, never say never, right?
and it was rented under a lease for 130 days (empty the remaining days, but listed as available to rent or sell).
I assume the property was 100% rental then. Your date of conversion to rental property is the first day a renter "could" have moved in. Then, provided you did not live in the property as your primary residence, 2nd home, vacation home or any other type of "personal pleasure" use after that conversion date, you indicate it was rented "the whole year". The program will figure your depreciation based on your in service date, and not on the fact that you select "the whole year".
I also assume your "130 days" was the last 130 days of 2021, and it remained classified as a rental after the new year and into 2022 - and most likely is still being rented today. Is that assumption correct?
