Option 1: invest money Option 2: STR with Cost Seg Investment income on $1.2 M W2 income 25% tax on Income Money in the bank Value of my time Net Income on $1.2M STR $1M Bonus Depreciation W2 income 25% tax on income Money in the bank Value of my time ($100*200 hrs) REAL NET PROFIT Year 1 $90,000 $250,000 $85,000 $255,000 0 $50,000 -$300,000 $250,000 $0 $300,000 ($20,000) $280,000 Year 2 $90,000 $250,000 $85,000 $255,000 0 $50,000 -$300,000 $250,000 $0 $300,000 ($20,000) $280,000 Year 3 $90,000 $250,000 $85,000 $255,000 0 $50,000 -$300,000 $250,000 $0 $300,000 ($20,000) $280,000 Year 4 $90,000 $250,000 $85,000 $255,000 0 $50,000 -$100,000 $250,000 $50,000 $250,000 ($20,000) $230,000 Year 5 $90,000 $250,000 $85,000 $255,000 0 $50,000 $0 $250,000 $75,000 $225,000 $225,000 Year 6 $90,000 $250,000 $85,000 $255,000 0 $50,000 $0 $250,000 $75,000 $225,000 $225,000 Year 7 $90,000 $250,000 $85,000 $255,000 0 $50,000 $0 $250,000 $75,000 $225,000 $225,000 Year 8 $90,000 $250,000 $85,000 $255,000 0 $50,000 $0 $250,000 $75,000 $225,000 $225,000 Year 9 $90,000 $250,000 $85,000 $255,000 0 $50,000 $0 $250,000 $75,000 $225,000 $225,000 Year 10 $90,000 $250,000 $85,000 $255,000 0 $50,000 $0 $250,000 $75,000 $225,000 $225,000 TOTAL $2,550,000 $2,420,000  In the immortal words of Tom Hardy in Inception, "you mustn't be afraid to dream a little bigger, darling".You have a good understanding of things, but you're missing the ways it can be leveraged.Bonus depreciation works best when you have one high earning spouse and one non-working spouse. 

Investing in real estate is truly my dream, but I have chosen to sacrifice/postpone my dream, so she can get hers.

I'll also guess 90% of the heat and air is a window unit or something not really tied into the main house.One thing I would also say is as best you can divorce the idea of an owner/occupied dream house from an investment property.   

If a seller won't pay, the likelihood of a buyer walking away from their dream home merely because an agent can't be paid is slim.

I wouldn't wait 5 years to go after your dream....time flies by way too fast.

I don't know about you, but in 30 years I'd rather be sitting on a million-dollar asset that I own free and clear (because someone else paid it off for me) that is generating multiple, multiple times the rent I was collecting when I first acquired it and in which I can fill a vacancy with a qualified tenant within two weeks because the area is so desirable that it can't keep up with housing demand than on some boondocks asset that I only purchased because it was the cheapest thing around and "cash flowed" $200 per month on paper but barely appreciated over the years and whose rent appreciation has marginally kept up with inflation and takes me three months to fill a vacancy with a "qualified" tenant who even then might get behind on rent because his hours were cut at the gas station 30 miles away (true story; my tenant worked at a gas station in Boron--only job he could find).Personally, I'm keeping my 4-unit in Santa Clarita and investing in development deals and notes until an incredible off-market deal lands in my lap (keep dreaming, Logan) or the SoCal market cools.  

Dreaming...

🌟 Dreaming of financial freedom?

Here are some favorites among real estate investors:"Set for Life: Dominate Life, Money, and the American Dream" by Scott Trench: While not solely focused on house hacking, this book offers practical advice on building wealth through real estate investing, including house hacking strategies."

Heck, have him send you $50k for his half of that dream $100k vacation you plan to take next year.