To give you an idea of how it change the Real Estate industry, the law contributed to the elimination of the capital gains tax differentials, the increase in the period for writing off taxes for depreciable real estate, and the limitation of the deductions of passive investment losses.

Behavioral economics tells us people experience the pain of losses twice as much as gains.

You can not deduct the down paymentYou can deduct any costs you incur to upkeep the property(Repairs, insurance, taxes, depreciaiton, etc)Whether you can offset the rental loss against other forms of income depends on whether the property is considered active or what your income level is.

If you do it anyway, then you must accept that you will probably realize a loss because those people will not respect the time, money or effort you put into a rental property and will just think you're a greedy bastard. 

It doesn't bother me to lose some money on my place because I use it, I like it, and I'm working towards higher rates with some of the improvements, but I can afford the loss.

This practice enables the Tax Commissioner to maintain a very high collection rate because the investor absorbs the risk of loss (but also the potential for profit).

Mainly, the LLC prevents a loss from spilling over into your other investments or your personal finances in many cases (though not all).

I would rather absorb the loss of rent than deal with any more passive aggressiveness from the current tenants and lose out on good leads as a result of that.I really appreciate each of you for taking the time and clarifying things for me.

Unit 1 will lose this small storage.We settled for $ 250 rebate per month for the loss of this small storage.And $ 700 rebate for the construction.

I made some elections about grouping by not grouping as I expanded and didn't understand the consequences (making material participation easier/when passive losses can be harvested/ease of filing) of that at the time.Also random question but do you have a sister Nicole?