Publication 527 |
2000 Tax Year |
Property Changed to Rental Use
If you change your home or other property (or a part of it) to
rental use at any time other than the beginning of your tax year, you
must divide yearly expenses, such as depreciation, taxes, and
insurance, between rental use and personal use.
You can deduct as rental expenses only the part of the expense that
is for the part of the year the property was used or held for rental
purposes.
You cannot deduct depreciation or insurance for the part of the
year the property was held for personal use. However, you can include
the home mortgage interest and real estate tax expenses for the part
of the year the property was held for personal use as an itemized
deduction on Schedule A (Form 1040).
Example.
Your tax year is the calendar year. You moved from your home in May
and started renting it out on June 1. You can deduct as rental
expenses seven-twelfths of your yearly expenses, such as taxes and
insurance.
Starting with June, you can deduct as rental expenses the amounts
you pay for items generally billed monthly, such as utilities.
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