Or...Cost to Scape & Build:      $500,000  (3,400 sq ft)Sales Price:                        $750,000Gross Profit:                       $250,000Then subtract out the holding costs (payments on the bridge loan, while construction is underway), the opportunity loss (you will have significant financial flexibility tied up, plus the Time Value of Money equation), now figure out what your risk contingency is and subtract that as well.  

So 1440 *could* be subtracted from each yearly expense.

When I do my deal analysis, I always figure (among other things) 10% vacancy, and subtract 10% from gross rent for regular maintenance.  

for starters, the vast, vast majority of agents can barely do addition and subtraction.  

Here are a couple of numbers I use -- and many other investors too -- although others may prefer to tweak the percentages a bit for their style or individual market.Flips or rehabs --  Take the After Repair Value of the home (ARV) and multiply it by 70% and then subtract the rehab.

Once that figure is established then one subtract following costs: 1.Sale Cost (Commission and escrow)2.Carrying cost (Loan cost)3.Fix up cost4.Desired Profit5.Purchase escrow costAfter one deducts all the above costs from the projected sale price one ends up with recommended purchase price.You can call me if you have any other questions.Good luck,George

What the formula does is subtract the total interest you owe from the annual payments and then add that to your taxable net income.

Another trick is to figure out what your mortgage payment and expenses would be after you buy, subtract out your rent, and autotransfer the difference from checking to savings every month on the 1st ... this helps save money, validates that you can afford what you'd like to buy, and show you the effect it would have on you financially.

Add in tax, insurance, mgmt fees , hoa fees vacancy fees maintenance costs and subtract that total from rent. 

On $1 of earned income you bring home $0.62. and it breaks out like this:$1 of Earned Income-$0.24 (Federal)-$0.06 (State)-$0.08 (SS & FICA)But with rental income, $1 brings home $0.91, here's how I got there:$0.64 of income is offset by depreciation (my example assumes a $275k property, 11.5% ROI)So, your paying tax on $0.36, now subtract 20% for QBI for $0.29 of taxable income.