@Steven Yang I don't know if you are interested in buying in South Jersey or not, but if you are, you can find some nice properties in that range, with not too terrible taxes.  

@Chheang Yang, The statutory requirements of 1031 force you to relinquish (close sale) of your old property before taking title to the new property.  

Right so passive losses flow through to your return of your MAGI is below $150k.

When selling straight out seller pays--capital gain tax -depreciation recapture tax at max 25%-net investment income tax at 3.8 percent if his MAGI greater than 200k.

I know there are rules regarding active versus passive investing and there is a cap (MAGI) but if one is over the cap, can nothing be deducted?

Management decisions that are relevant in determining whether a you actively participate include approving new tenants, deciding on rental terms, approving capital or repair expenditures, and other similar decisions.There is a phase out if your MAGI is above $100,000 and completely lose it after 150,000. 

The amount of capital gain earned above that level is taxed at 15% in the 25% bracket and 20% at higher brackets, with the 3.8% Medicare surcharge kicking in when the MAGI is at or above $250K (MFJ).

@James Yang Thanks!

@Steve Yang..if you are interested in SFH around Western suburbs, please let me know.

@Amy Gullotta You are not entitled to depreciate the property since it doesn't appear that it was ready to be rented during 2017.If you decide to sell("flip") the property in 2018 - you will have to pay applicable income  taxes as a result.Since your original intent was to buy and hold this property - you may be able to defer the gain via 1031 like kind exchange.The equity in this house(65,000) may entitle you to purchase a property around $250,000(or 2 properties around $125,000) if you factor in a 20% down.If you decide to rent the property - you may be able to lower your overall tax burden if your MAGI is below $150,000 and you show a loss on your rental property.