I was interested in something like owning a rental property as a way to generate some additional income. 

For all methods you would want to find a market that has strong employment rates, strong income rates for the market, and is a growing or an established market. 

Lots of depreciation you will pay no tax maybe even shield some W2 income.B.  8k maybe 10k if you pick the right guy to lend your money to in interest income you will be paying much higher tax rate on this income FYI no depreciation expense. 

The owner should look at it more like a DSCR, and should be pricing the property and offering terms such that the income from the property is adequate to pay back the loan.

I'm confused why would you say that rental income is taxed in an IRA?

Who knows, when you get down here you may be happy you have some extra income coming in. 

And assets that provide you with great depreciation but not great income or stability are just a form of robbing from Peter to pay Paul.   

Kudos to you for doing something to create a secondary income stream. there are 5 income streams in RE rentals, possibly six if you do things a certain way.The reality here is your model (buy box) is suffering from too high an entry and too high a cost of capital.

You have come to the right place to explore different ways to generate passive income.

As a work around, we use a residential building and mark rents as commercial income.