There is a lot of misinformation floating around the web saying you can take startup cost prior to in service date, but unless you are a professional realtor your rental is not a trade or business. It is passive investment income, and you cannot take expenses prior to putting in service. You should capitalize all your expenses, and add to basis. If you want to read for yourself see Sec.195, Sec 263A, and Sec.164. Some tax professionals might advise you to treat it as a second home, then you may be able deduct property taxes, Mtg. interest if you itemize, then convert it to rental when it is available for rent.