Post-closing possession and income taxes

[RWD]

We bought a house last month with a post-closing possession agreement:

The Seller(s) will retain possession of the Property after Closing defined in the attached Contract until midnight on <date>. [...]

The Seller(s) will pre-pay the Buyer(s) rent at a rate of $<rate> per month plus a security deposit of $<deposit>, which security deposit will be refunded at the time Seller(s) surrender possession in the same condition as at the walk through inspection.

So we have received approximately 1.5 months worth of rent, but I don't know how this will be handled on our 2016 income taxes. Google searches have not been helpful. I'm wondering if this is handled differently than a normal landlord situation because it's such a short "rental" period. Will it be treated like regular income? We will occupy the house as our primary residence for the remainder of 2016 (about 7 months).

[Drifterrider]

Because your contract specified "rent", claim the rent as income on Schedule E  (the IRS will eventually find out).  Prorate the property taxes and insurance (even down to a number of days/ 365).  Put the gain or loss on the appropriate place on your 1040. 

Do you use one of the tax software programs?

Many people are amazed to get audited because they didn't think the IRS knew about their interest income because the individual didn't receive a 1099.

[RWD]

I use TaxAct to file my taxes.

Looks like the threshold for whether you need to use Schedule E is 15 days of renting, if I'm reading the IRS page correctly.
https://www.irs.gov/instructions/i1040se/ch02.html

If you did not use the unit as a home, you can deduct all your expenses for the rental part, subject to the at-risk rules and the passive activity loss rules explained earlier.

If you did use the unit as a home and rented the unit out for fewer than 15 days in 2015, do not report the rental income and do not deduct any rental expenses. If you itemize deductions on Schedule A, you can deduct allowable interest, taxes, and casualty losses.

If you did use the unit as a home and rented the unit out for 15 or more days in 2015, you may not be able to deduct all your rental expenses. You can deduct all the following expenses for the rental part on Schedule E.

• Mortgage interest.
• Real estate taxes.
• Casualty losses.
• Other rental expenses not related to your use of the unit as a home, such as advertising expenses and rental agents' fees.

[KeithLauraJackson]

We have the same situation this year, so commenting here to keep track of any other responses  :)

Thanks!