[Sylvanfan]

^^^
Wouldn't it only be from the day you convert the primary residence to an income property? So it's not like he should be paying gains from the original purchase price but from the value of the property on the day it was switched over.

Although I'm sure the loophole is closed on the scenario where you refinance it for as much as you possibly can afford use the cash difference to buy your new place, and than convert that place to a rental property and rent it out to cover your old payment type of thing. That way you can claim a substantial capital loss on the property every year. Essentially you would have bought two properties with the money borrowed off of one. I imagine the governments closed that one.