Help me in understanding estimating financial goals. Am I understanding it correctly?

[Emily B.]

I’m trying to set some financial goals for myself and I keep hearing how I should be specific so that I know exactly what I’m working towards. With that, I want to make sure I’m understanding some of the calculations when trying to figure out how many properties I may need to get to said goal, so I was hoping someone could check my understanding here. I want to get into long-term buy and holds, single family to start but possibly MF as I get more comfortable with what I'm doing.

Here’s my practice example:

Say I have a property that I’ve bought and worked on with my after-tax dollars from my job so that, essentially, I own it without a mortgage payment. And then I rent it for $1,000/mo. Using that, am I correct in planning that I should take 50% of that and put it into a reserve for expenses ($500), pay taxes and insurance ($250), which then leaves me with $250 in positive cash-flow? Which then, essentially, means $3,000 cash-flow for the year before taxation ($250x12).

Again, I’m trying to learn more about the financial planning aspect, and I know this is a fairly simple example. I just want to make sure I’m at least on the right track.

If I am, let’s take it another step. What percentage is that yearly cash-flow taxed at? In other words, how can I estimate what I will actually net from that? I hear all the time that passive income is subject to a lower taxation than what I make at my job (earned income), but how does one estimate what percentage that is?