You are correct you can learn a lot from books, podcast, shows.

You are in fact correct that yes, I am currently analyzing potential investment areas behind a computer.

@Tim Porsche just a little food for thought. 

Were all of the renovations you did in the past permitted correctly or DIY?

@Ted Barrettyour analysis is roughly correct. 

Correcting this should adjust the profit at sale.Additionally, your property taxes seem quite low.

Quote from @Felicia West: Thank you, Zachary for your very thorough explanation.Quote from @Zachary Jensen: Hey Felicia, At a high level you’re correct that when you and your husband’s income exceeds certain thresholds (over $150,000), passive losses from rental properties, including depreciation, can’t offset your W-2 income unless you or your spouse qualify as a Real Estate Professional (REPS).

Last question, you are hiring an architect and submitting plans to the city in a renovation like this correct?

It shouldn't be a recurring scenario (or it looks a little less "accidental") but in cases like this, your job is to simply have the correct intent, see what you have done to demonstrate that and build your case.

Local Economic Indicators: Monitor local employment rates, population growth, and housing inventory to time your deals correctly.