You need to read IRS Pub 527 Residential Rental Property You need to layout the timeline regarding the activities on the property. You will need to know not when you rented the house, but when it was placed in service, which is the date that it was ready to be occupied. Your interest before this date is related to the property as a personal home.
For example regarding the interest, taxes and insurance:
- January to move out date: Interest,taxes on schedule A. Insurance not deductible.
- Move out date until placed in service date: Interest, taxes on schedule A. Insurance not deductible.
- Placed in service date until the end of the year: Interest, taxes, insurance all deductible on schedule E.
You will also have to determine the deprecation on the property during the period the property is in service.
Regarding personal use of the property. The important thing is the date the property was placed in service. Let the tax software determine what is the maximum amount you can deduct, fill in all the allowed expenses and all your rental income and see where you are. Expenses related to trying to sell the property and prepare it for rent have to be determined carefully to make sure they are allocated correctly.
In pub 527 Chapter 4 will be very important for your situation:
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
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, qualified mortgage insurance premiums, 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
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.When figuring depreciation, treat the property as placed in
service on June 1.