But her name is not on the properties.As I understand, we don't get any advantage in the real estate losses against my W2 income.

Because non-passive losses can offset non-passive income/ active income.

@Marco PadillaIt's easy for us to say all this because we have experienced it; the initial visceral reaction to a large loss is emotional can you give us more color when you are back in country?

In general though, you're able to directly offset your income from the active rental activity with the *losses* you take from the business, but once the business becomes profitable, this would also add to your taxable income. 

Most of the largest cities in the Midwest, includingChicago, Detroit, Indianapolis and Minneapolis, rank in the middle of the pack.Geographic and infrastructure advantages support leasing by small manufacturingand distribution tenants in these locations.However, limited population growth, or in some casespopulation losses, result in less robust leasing among smaller tenants in localconstruction trades.

@David CozziYou may be able to do that.However, you have to consider the drawbacks of your stategy.You are converting a potential scenario where you have passive losses with no active income to passive losses with active income.

Anyway... having the ice cold steely eyed final arbiter has been beneficial in keeping my over enthusiasm from creating financial loss.

Ultimately the borrower sold the property before sale so it was a non issue but had they not, and had we continued with default, if we did not restructure the foreclosure (difficult), we would have more than likely had to wait until sale, suffered a loss, then filed a title claim (Time...time...time...) to hopefully be made whole. 

Loss History.  

Your partnership distributes ("passes through") your STR losses to your respective personal tax returns via K1s.