This allowance lets you deduct up to $25,000 in passive real estate losses to offset other income (like W-2 wages).

i.e. deductible for a roof replacement or replacing an HVAC unit or replacing a hot water heater? 

I told the tenant I'd consider the current payment on time (as long as it doesn't bounce) since the money was deducted from his account on the 14th, the rent due date on the lease. 

Not sure how complicated your situation is, it is easy to miss necessary elections in order to claim appropriate deductions.

As you grow your business, having a real estate accountant in your corner can help you maximize your deductions, ensure compliance, and plan for future investments.

Here is a framework to think about how buying properties creates the most tax efficiency for you.The 6 levers of depreciation:Lever 1 - % of LandOne of the components of a property is land.Land is NOT DEDUCTIBLE, so low value land properties mean more tax deduction.A value of your overall purchase will be assigned to the land or lot.You receive no near-term tax benefits for buying land.For example - If you buy a $2 MM industrial building outside a rural town on 5 acres, the land value could be $5k an acre.

The key factor is ensuring you have proper documentation to support all the transactions, deductions, and income reported.

So yes, you need to set aside enough money to pay future taxes.Taxes are calculated only on your net profit - i.e. after everything is deducted, including labor & materials, holding costs, financing costs and business overhead such as marketing and driving. 

@Mike SmithyIts been a while since I was licensed in Texas, but I seem to recall that the landlord can only deduct actual financial loss, in the event of a premature vacancy.

If they have any rules about short-term vs. long-term rentals, you’ll want to know upfront to avoid headaches.Also, keep an eye on tax implications – renting while living there can open up some sweet deductions. :) Sounds like you're setting yourself up for success!