A lot of times there's some base rent, plus a cut of their gross revenue. 

It currently has 3 tenants and grossing about $2200 / month, between $750 and $800 each.

For example I have house hacking clients in Malibu doing STR and the city imposes a 15% gross income tax.The popular areas (Joshua Tree, Big Bear, etc.) from what I am hearing are over saturated.

So that would be $3500/month total gross rent. 

Net income = $39,240Monthly operating expenses are as follows: Trash - $33, Landscaping/yard - $66, Electric - tenants pay, Water - $95, Maintenance $87Monthly taxes about 3KSo, gross expenses are at $41,064If I'm doing the calculations correctly, my net operating income is -$21,888 and cap rate is -3.4%.Obviously the current numbers look terrible for this investment, but I feel like the rent should be raised significantly based on comps (above 2K each unit). 

But I'm not that confident yet The loss is limited to $25000 only if you are adjusted gross income is $100,000 or less.And yes, as long as you are not benefiting from these deductions then you don't have to worry about the depreciation recapture rules when you sell or exchange in the future.

The tax deduction is limited to 30% of your adjusted gross income.

Any ideas how much single family houses in Butler beach can rent for in terms of gross income in a year? 

Looking at how much interest you're paying over the life of the loan is gross, but how realistic is it to think you'll actually be paying on house for 30 years?

You could purchase a property with 9 beds that is fully themed out that is grossing $150/year or so.