First time Landlord, many questions

[Michele Foreman]

We are first time landlords, and I have many questions. We have had the house for three years, it was a foreclosure and needed lot of work. Basically everything is new, flooring, kitchen, bathroom, partial roof. I have talked to my accountant but I really need more help than he was able to give. First off, what expenses can we deduct this year? I know insurance, taxes, and utilities are deductible. Would I be able to deduct any of the new materials or is all of that depreciated? I also read somewhere that paint was an expense we could deduct but not if its the entire house. I have kept all my receipts over the years and my accountant said I could depreciate all of our expenses over the years but if we ever sold the house then they would have to be accounted for. Also, should we have a separate bank account for the rental account? We haven't done this yet. Can we deduct our mileage every day that we went to the house when remodeling it and our trips to the hardware store? And if so what records do we need to keep for this expense? Should we put the property in a LLC or should we get an umbrella policy with our insurance or both? I'm really scared about getting sued by someone. We have made the house as safe as possible but the family has three little kids and the property is two stories, with the kids bedrooms upstairs. I painted the stairs black, and I have people telling me this is a liability issue. I'm not sure how to make it safer, short of repainting the stairs a different color. I have thought of using glow in the dark paint or tape but not sure if that would work. We have disallowed trampolines and swimming pools, to the dismay of the tenants, so hopefully they will abide by this rule. Also, there are kids on all sides of the property, running through the yard all day. The tenants have signed the contract and will move in September 1. Thanks for any advice anyone is able to give me!