Rick19744
Level 3
Level 3

Also keep in mind, that at the date the home was converted to rental, the basis is the lower of cost or the FMV at that time.

This is often forgotten or missed.  FMV must also be used when determining if there is a loss on the sale.  See the attached Publication 527.  The basis matter on conversion is discussed beginning on page 15.

https://www.irs.gov/pub/irs-pdf/p527.pdf