Because you are a first time landlord, first time filing a Schedule E, and the questions you are asking suggest you are not very familiar with the jargon and terminology used in the real estate and mortgage lending business, I strongly suggest you use a professional to prepare your tax returns, both state and local.The real value of a CPA is not to prepare a tax return, but rather, the tax planning advice the CPA can offer for your investment strategy throughout the year. 

@Philip WilliamsJust came across your post today; it was featured on one of the BP E-mail Newsletters. 

Do I list them as an operating expense on schedule E even though they occurred before the in service date?

I love the way Phoenix roads are all either exactly N-S or E-W.

The proforma will have numerous data points that require research: rents, operating expenses, city impact fees, build costs, soft costs A&E.

Thanks,Does Darrel Richardson have an E-mail?

It means you need to file/pay state quarterly taxes (B&O Taxes) on that Income and report a Schedule C business now that you pay SE tax on vs. no SE tax if that income would have stayed on Sch E as rental income. 

@Ryan E.

Looking for a local agent/broker in E.

The tenant isn't borrowing money from you by paying on the 7th of the month, nor are you not enforcing your lease since you're issuing a pay or quit notice.I'm positing a different approach, one that comes with a letter, text, or e-mail, whatever your preference may be, to soften the blow of that notice.