Residence to rental property

[PaPaJ65]

I did extensive renovations in 2023 to my primary residence to turn it into a rental property. I lived in the house for 8 months and it was empty for 4 months. It was not actually rented in 2023, but will be rented in 2024. How do I claim the renovation expenses considering the house was not actually rented in 2023?  

[MarilynG1]

You can't claim the renovation expenses incurred to prepare your home for rental.

However, if you paid 100K for your home, for example, and did 50K in renovations, your home's Cost Basis is now 150K, which is the number you enter when you set up your rental property in TurboTax.

This gives you a much larger Depreciation deduction to claim as a Rental Expense each year.  Save your receipts for documentation, if needed. 

Here's more info on Depreciation of Rental Assets and Tax Tips for Landlords you may find helpful.

@PaPaJ65