Presence in the US in a non-immigrant category counts against a stay as a visitor, so if he's been there more than six months as TN-1 an AOS to B-2 could be denied. The best way of doing it is to leave and reset the clock, given that it's the end of the year.
I agree with resetting the clock, you are right. I would be more concerned with not having an established residence in Canada. Therefore he/she might not be allowed back into the U.S. on B2 until utility bills, or apartment lease, etc. can be shown.
Therefore, it may be wiser to request a 2 month mail-in change of status to wind down affairs rather than attempt re-entry as B2 at the port of entry.


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