You can treat it as a single asset if you want. Or you can cut all expenses in half and treat each unit as a physically separate rental property. I personally would recommend the latter. One of the reasons is, suppose something happens in the future and you need to move into one of the units as your primary residence? Or if for some unforeseen reason one of the units becomes uninhabitable for an extended period of time? Treating each as a separate unit makes it easier for converting from rental to personal use. It also gives you the option (if possible in your area) of selling one of the units at some point in time, without you having to deal with the extra paperwork of separating things out on your taxes.
For setting each up as a separate unit, you just split your cost basis on the property between the two units. You also split the mortgage interest, property taxes and property insurance between the two.
Then for the heck of it, lets suppose the central air in one unit has to be replaced a few years down the road. The cost of replacement would be considered an asset for that unit only, thus adding to the cost basis of that unit only. There are many possible scenarios that could potentially occur, where treating each unit as a separate rental property on your taxes would make things easier/simpler at tax time each year.
But again, that's just my recommendation. The final call is yours.
