TaxGuyBill
Level 15

@ajp wrote:

That's what it is! Thank you. 

She lived in the house for part of the first year that it became a rental. 


Take a step back.  Was she using the house only BEFORE it became a rental, and NOT after it became a rental?  If so, there should not be "vacation home" losses, and you may need to amend the prior tax return (if there was NO person use AFTER it was converted to a rental, the "personal days" should be zero; you would need to MANUALLY prorate the expenses for that year for the rental period).