If the software is not simplifying your life or making you more accurate, you shouldn't use it.Software does have extremely helpful features like online payments, marketing syndication (click a button and your property is advertised on multiple sites), electronic document review/signing, maintenance tracking, and owner reports.

There are things that are missed in your simplified example….

AI-powered platforms are simplifying this process by automating tasks like document processing, contract reviews, and even virtual property tours.

If you were to refinance and pull cash prior to the 2 years then it does create an inclusion event.That's a bit of a simplified answer, but hopefully it makes sense.  

But these are few and do generally require a high investment amount.If you're looking to simplify and move into a passive environment Delaware Statutory Trusts offer the passivity and are compliant with 1031 exchanges. 

So in your example, if you buy 4 $100k properties that have an 85% basis (you don't get to depreciate land), pay $10k in interest on each property, and spend $5k on repairs and maintenance on each property, your deductions would be:$3091 depreciation x 4 ($100k property x .85 basis /27.5 years) = $12634$10k interest x 4 = $40000$5k repairs etc x 4 = $20000Total deduction = $72634If you bought one property, just divide this whole thing by 4 = $18159 deduction for one house.Obviously this is super simplified but you might want to talk to a tax professional that specializes in RE taxes before you do anything.

Simplified illustration of this would look like: if your home is worth 100k, and your outstanding loan balance is 70k, then you would be able to pull out 10k in a cash out refinance.

I know this will cost more money but I think my current simplified accounting methods need to be more thorough especially with the IRS looking to double up on its number of auditing employees in coming years. 

Greatly simplified things. 

I'm diverging from the intent of your original post, but simplified analysis becomes misleading and distracting.