Converting my home to a rental property

[surferdude69]

I moved out of my main home in August 2023, and converted it to a rental property.  The house sat vacant on the rental market for eight months, producing no income at all in 2023.  Finally, a tenant moved in in April 2024.  When I filed my 2023 tax return (a year ago), the TurboTax expert told me I should not report my landlord expenses at all for 2023, and instead I should report those 2023 expenses on my 2024 tax return.  (e.g. homeowner's insurance, cleaning expenses, utilities etc.)  I spoke with another TurboTax expert yesterday, who confirmed that that was the correct thing to do.  So I know I did not mis-hear what they told me.  Today I spoke with another TurboTax expert, who told me that that was the wrong thing to do, and that I should amend my 2023 tax return to report my landlord expenses from 2023.  Can someone please tell me which is correct, and tell me exactly which IRS rule applies?  Should I report my 2023 expenses on my 2024 tax return?  

Whether or not I amend my previous tax return will not affect my refund for 2023 or 2024.  But I pay money for TurboTax because I expect my returns to be amendment-free.  I am very annoyed at the conflicting advice from various TurboTax experts.  It is causing me to lose confidence in TurboTax.

[KrisD15]

Expenses of a rental are reported once the rental is put into service. 

This means there is a "FOR RENT" sign in the window, not that you necessarily have a tenant.

Expenses are reported in the year they are paid. 

Rent income is reported in the year it is received. 

According to the IRS:

"If you receive rental income for the use of a dwelling unit, such as a house or an apartment, you may deduct certain expenses. These expenses, which may include mortgage interest, real estate taxes, casualty losses, maintenance, utilities, insurance, and depreciation, will reduce the amount of rental income that's subject to tax. You'll generally report such income and expenses on Form 1040, U.S. Individual Income Tax Return or Form 1040-SR, U.S. Tax Return for Seniors and on Schedule E (Form 1040), Supplemental Income and Loss. If you're renting to make a profit and don't use the dwelling unit as a residence, then your deductible rental expenses may be more than your gross rental income. Your rental losses, however, generally will be limited by the "at-risk" rules and/or the passive activity loss rules. For information on these limits, refer to Publication 925, Passive Activity and At-Risk Rules."

Pub 527

"You place property in service in a rental activity when it is ready and available for a specific use in that activity. Even if you aren’t using the property, it is in service when it is ready and available for its specific use."

“Cash method. You are a cash basis taxpayer if you report income on your return in the year you actually or constructively receive it, regardless of when it was earned. You constructively receive income when it is made available to you, for example, by being credited to your bank account.”

“When To Deduct
You generally deduct your rental expenses in the year you pay them.”
 

I cannot attest to the advice you previously were given, perhaps there was a miscommunication issue. 

If you click on "Get Extra Help"  for the rental section, it might have the answers you are looking for. 

[surferdude69]

@KrisD15   I tried to amend my 2023 tax return, but discovered that my rental house did not exist (for tax purposes) in 2023, because it was rented for fewer than 15 days (actually zero days).  In that situation, there is no way for me to deduct my landlord expenses from 2023.  It’s just a non-deductible loss.

[AmeliesUncle]

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@surferdude69 wrote:

because it was rented for fewer than 15 days (actually zero days).  In that situation, there is no way for me to deduct my landlord expenses from 2023.  It’s just a non-deductible loss.

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Enter ZERO personal days.  You only enter personal days for AFTER it was converted to a rental.  It should allow it.

You will need to manually prorate some expenses to account for only the period that it was available for rent.