Computing taxable income on a rental is OK.

@Cal EwingIf you are trying to grow the U.S.A. side of your business, you will most probably want to retain earnings in-country and not be forced to repatriate them back to Canada - the currency exchange back and forth would only line the pockets of the FX folks and the additional taxable events will only make the IRS and CRA happy.To do this requires some form of entity in the U.S.A. and will necessitate filing taxes there.  

You would have to appraise the property and that amount will be report to you by the IRA custodian and will be taxable event. 

ABC LLC has taxable income for 2017 of $15K after taking into account depreciation. 

Thanks Corby, I did a little research and According to the Real Estate Transfer Tax Regulations for the Philadelphia "a quitclaim deed is taxable upon the same basis as other deeds if there is an actual conveyance of real estate."

Net Operating Income (NOI) 25,800 26,466 27,148 27,843 28,554 Debt Service -16,115 -16,115 -16,115 -16,115 -16,115 Before Tax Cash Flow 9,685 10,351 11,033 11,728 12,439 Depreciable Allowance -8,145 -8,145 -8,145 -8,145 -8,145 Mortgage 1 Interest -13,365 -13,195 -13,015 -12,824 -12,621 Taxable Income 4,290 5,126 5,988 6,874 7,788 Taxes Due -1,072 -1,281 -1,497 -1,718 -1,947 After Tax Cash Flow 8,613 9,070 9,536 10,010 10,492 How come the cap rate is now 9.21 % ?

1. need to do STR at least for the rest of the year to qualify for bonus depreciation to reduce taxable w2 income, may later transfer to PMC and LTR with a long-term hold3. putting in around 30% (paying off seller equity), do have reserves for surprises, would want to refinance once rate drops to < 4.5 in few years (4-5) to take out equity and be able to hold the property at no to minimal cost.now this is all wish list and probably far from reality (day dreaming)

Here is an article on the rules - https://legalbeagle.com/how-is...I am pretty sure it would be taxable. 

Payment to you will have three components:1) return of the non taxable basis 2) capital gain 3) interest income.Your basis and the sale price will determine each of those components and your professional should for able to help you after you provide them with more detail. 

All that being said, the finance costs of any financed transaction are expenses that reduce your taxable income and a prudent investor should weigh the costs vs. the speed of doing a deal more quickly and therefore being able to do more deals in a year.