Negative Cash Flow : Tax Offset

[Manraj Singh]

Hi,

I am aware that acquiring a -ve cash flowing property is a BAD idea. Also aware that we shouldn't be looking at 1. appreciation and 2. tax benefits as an answer to offset a -ve cash flowing investment.

1. I am employed full time and do not own a rental property.

2. I am considering purchasing a property in my neighborhood with -$3000 cash flow in year one. ( after Motrgage, HOA, CapEx, expenses & vacancy)

3. I am currently employed with a W2, and expect to pay $3000 in taxes every year.

Not looking at appreciation - If I acquire this property today, would it not make sense to have this liability and using 100% losses in year 1 to offset my Taxes for a net zero?

Is it reasonable to assume that there might additional tax relief  through depreciation, and expenses etc on top of it? 

I would really appreciate if I could get an explanation ( think freshman college, whom you rather educate and not discourage) about my question. 

Thank you! Manraj

[Natalie Kolodij]

Keep in mind if your AGI is over $150k you won't get to use any rental losses against your w2 income