@Victor Yang To use the rental losses to offset any active income (W2), you'd have meet Real Estate Professional status (which would be difficult to do with a W2 job because you'd have to work more on real estate than any other job to qualify) OR have an AGI of $150K or less.

In my case, all three sellers were older and tired of dealing with tenants, but they liked the steady income.

Rental income carries the debt service 100% How did you find this deal and how did you negotiate it?

Hi Ryan,Typically construction financing isn't based on your taxable income and rather more contingent on your experience, FICO and the deal itself.

$1 lent for $10 of income? 

Co-living, on the other hand, mitigates this risk by creating multiple income streams.

If you pay two years' worth of property taxes in 2025 (January and December), both payments are deductible on your 2025 return, potentially reducing your taxable rental income significantly.

.: Here's a good guide with links to the law: https://www.tenantresourcecenter.org/earnest_moneyIf you charge $25 and the credit screening costs $10, you can keep the $10 as income.

Boom multiple income streams. 

If you have your mom live there without any rental income, it is not considered held for investment but is rather held as a second home and does not qualify for 1031 Exchange treatment.