By default, a multi-member LLC is taxed as a partnership, meaning that profits and losses flow through to the individual members' tax returns.

We have some good Turnkey providers here but that product never appealed to me due to the entry price, declining rent as the house deteriorates and there is no real exit strategy without taking a sizeable loss for the first 5-7 years in most cases. 

If you overpaid in 2020-2023, based upon bubble multiples, the picture isn't as rosy.You have a choice to make:  Cut your losses or grind it out.

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.

the book in the bp bookstore. i did the rookie boot camp 2y ago that i imagine this book is kind of based around, and one of the first steps was picking your strategy. the tough part is: THEY ALL WORK. but they all require different skill sets, different amounts of time, and will create a different-looking life for you once the ball is rolling. you have to lay out what skills you have, what you do and don't like doing, how much time you have, and what your vision is for your investor-life 5y down the line, and choose the strategy that aligns best with those things. 

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. 

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).

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.