I visited Anchorage last weekend and am so jealous about your Restore.  

The basic idea, is that if the expenditure restores something to its basic functionality, it is a current year deductible expense.

I'm more south so we don't have to worry about the floors being too cold in the winter, but people carpet over wood flooring all the time and restore to original wood later.

And since it was built in the 1920's it could be under watch by the King County Historical Preservation Program... so there's that hurdle, but they would probably welcome someone who wants to restore it to its former glory.

Building Coverage – this mitigates and restores the building from covered losses. 

At the end of a tenancy, the unit must be restored to its original or pre-tenancy state so that it can be rented out again.

Don't misunderstand, he didn't botch-up the job, but unless you can make invisible repairs and and lyour painting skills match that of a professional, stick to clean-up, carpet removal, maybe some demolition.I would also suggest that any bids you receive for remodeling/restoration work be carefully scrutinized, you get what you pay for!

Lastly, I can restore my entitlement by refinancing to a conventional non-VA loan option, but not the IRRRL?

I've sold over 100 REO properties and, while a few were good buys, in many cases the properties are in such poor condition that the cost to restore them can be significant.

I know this post is old, but DOM Roofing & Restoration replaced 4 roofs on my rentals in the last 3 years through insurance.