New client owns 3 family for 20+ years. Rented 2 apts and occupied one. .  One of the tenants moved out in 2019. Returns  through 2022 returns show 2/3 rented to others. Not good.

Owner is not intending to rent second apt but will use for personally,  storage, place for family and grandchildren to visit etc. (his wife doesn't let him smoke or bring his girl friend  in the house, so it's a good hiding place)

I'm going to suspend deprecation of 2nd apt. and show property as 2/3 owner occupied.

Just want to verify that if he decides to sell the property after 2 years, 2/3 of the CG on the adjusted building would be subj. to IRC 121.