You can take advantage of bonus depreciation and accelerated depreciation deductions to offset your passive income.With the 1031, you might have excess basis which is eligible for bonus depreciation. 

We get about $900 in excess.

Any excess amounts in the master are then assets or liabilities or capital of the master which are noted on its books. 

You waive the excess.

When a tenant moves out, transfer the deposit back to Checking so it's ready to apply towards expenses or refund the Tenant.If you end up with excess funds in the Checking account, I recommend you transfer it to a third account designated explicitly for future investments.

Just make sure you set enough aside for capex, vacancies, unexpected insurance increase, taxes, tax professionals, and local considerations (excessive heat? 

FYI, over the years, we've also learned to save a lot of money wasted on excessive management labor costs (we call them "stupid trips") by planning the occasional weekend to drive down, inspect our units and address any labor-cost intensive items that we can do over a 3-day weekend. 

Our lease calls for no nuisances such as excessive noise.  

(in essence she is borrowing excess funds to help make the payments) $8,312.50 x 36 months = $299,250 allocated to MAKE the payments on the $1,425,000 Note obligation.

Rents will gradually increase as some landlords exit the market with high end condos seeing less rent increases due to excess supply from new construction.