You’ll want evidence of the condition when they leave so you can justify deducting from their deposit.

Construction started on the one in the business within a week of closing while the other has some minor repairs.Are all fees and taxes associated with the purchase of the property deductible that can be found on the Closing statement?  

I figure I am running a business and I would rather take my own deductions as I see them needed vs less money in pocket and someone else taking the deductions.

I understand that I can divide the expenses and those that are related to the rental property can be tax deductible while those that are related to my personal dwelling are not. 

I believe including the rental income after deductions we pay taxes on around $55,000/yr.

An assessment is a property valuation that the town uses for the purposes of levying property taxes.A change in zoning (likely) would not affect just one property.

OR is it standard to just assume that deductions will reduce the taxes to almost nothing?

How does this work exactly...Passive activity losses (PALs) generally are deductible only (1) against income from passive activities, (2) when the entire interest in a passive activity is disposed of in a taxable transaction, or (3) under the $25,000 rental loss privilege for qualified rental activities (subject to the $100,000 AGI phase-out and is lost completely at 150k) The general is a rule allowing up to $25,000 of active participation(see below) rental real estate losses as a deduction against nonpassive income.The taxpayer must make management decisions with regard to the property, have at least a 10% ownership share in the property, and the cannot be a limited partner.

Depending on your home insurance you could try a claim with them, my State Farm policy has a home systems protection that has a $500 deductible for any systems that go out they will replace (HVAC, etc). 

@John HannaThey are referencing the Rental Real Estate Loss Allowance which is $25,000 of a deductible loss ONLY if your AGI is less than $100,000.