TFS Code Reviews - Show updated files in response to comments

So the process would flow like this:

1. Person 1 requests a code review.
2. Person 2 adds comments and selects "Needs Work."
3. Person 1 makes the necessary changes.
4. Person 1 Updates the shelveset associated with the code review
5. Person 1 adds comments to continue the discussion
6. Repeat steps 2 - 5 until accepted

Here are the steps necessary to update the shelveset associated with the review.

1. From the "Code Review" pane select the "view shelveset" link
2. From the "Shelveset Details" pane highlight and copy the shelveset name
3. Navigate to the "Pending Changes" pane, click on "Shelve" and paste the shelveset name
4. Press the Yes button on the shelveset replace verification dialog
5. Now the reviewer can see the updated files and the review discussion can continue

I've included some screen shots as I find it helps to clarify things.

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1) From the "Code Review" pane select the "view shelveset" link as shown here:

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2) From the "Shelveset Details" pane highlight and copy the shelveset name as shown here:

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3) Navigate to the "Pending Changes" pane, click on "Shelve" and paste the shelveset name for example:

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4) Press the Yes button on the shelveset replace verification dialog:

I believe the correct procedure is fore Person 1 to make the changes and request another review. When your code needs work that means you will be changing it so you will want to have the old version to look back to for comparison. You still have the old review in the history after it is closed if you wish to look over the comments. We are currently in the process of optimizing our code review process in my workplace.

I know this question is old, but it's still not supported as pointed out by other posters. The solution proposed by chad will work for some things but will have odd behavior for others.

Recently, the TFS team began the planning stages for a solution to a very old uservoice request to enable updating of a Code Review now migrated to developercommunity.visualstudio which should elegantly solve this problem by making Code Reviews have iterations.