Please help- Question regarding depreciation multiple properties

[Ben Kornblatt]

Hello BP community,

I was hoping to ask the veterans and those more experienced than me on this subject.   The question is in regards to depreciation with multiple properties. Lets say for example you have two SFH worth 150k each, and the land value is 25k. The depreciation for each property would be 125k / 27.5 = rounded to 4.5k for depreciation each year. Lets say property A has a 30 year fixed mortgage and property B is paid off. If they both rent for 1000, but property A cash flows for 200 per month (with mortgage, etc.) and property B cash flows 1000 per month (no mortgage). 

My main question is: can you use the depreciation of one property towards another? Is it a total amount for the year? In the example you have 9k (4.5K+4.5K) of depreciation each year but 14.4k total cash flow (2.4k from one property 12k from the other property). Are you able to depreciate the 9k from the total 14.4k cash flow so one is effectively being taxed on the 5.4k total (14.4k-9k)? Or is it separate? property A taxes: 2.4k-4.5k = (-2.1k potential tax losses not realized) and property B 12k-4.5k = 7.5k  Sorry for the lengthy message, but any insight would be greatly appreciated! 

Thank you,

Ben