Rental Property fix up expenses prior to sale

These are not expenses; they are invested in the property. They are right there, in the new paint, windows, flooring, yard, etc. That's why they don't get entered as Expense. They are part of figuring if the project made Profit, because they are part of costs, but not expense. Think of it as Further Investment in the project, not as expense.

I don’t like this question. I wish you hadn’t asked. It triggers memory of the old law about selling a primary home and reinvesting the proceeds to avoid paying tax on the gain. Do you still have clients who ask about that? I do. I tell them that law was changed back in the days of President Clinton. Some of them don’t remember Clinton but they remember selling a home and buying a more expensive one. Anyway, “fixing-up expenses” was a term of art. Specifically,

§ 1.1034–1 (6) Fixing-up expenses means the aggregate of the expenses for work performed...on the old residence in order to assist in its sale, provided that such expenses (i) are incurred for work performed during the 90-day period ending on the day on which the contract to sell the old residence is entered into; and (ii) are paid on or before the 30th day after the date of the sale of the old residence; and (iii) are neither (a) allowable as deductions in computing taxable income under section 63(a), nor (b) taken into account in computing the amount realized from the sale of the old residence . . . Fixing-up expenses does not include expenditures which are properly chargeable to capital account and which would, therefore, constitute adjustments to the basis of the old residence...

As I recall, fixing-up expenses never really helped, except in rare cases when part of the gain was going to be taxable. But if what you mean by “fixing-up expenses” are things that can’t be added to basis, then why not deduct them on Schedule E for 2019? It’s cleaning up the mess the last tenants made, after all.