Plus real estate is tax advantaged!

I have no idea, but this doesn't sound right.This is in the tax code not a loophole.

What city, states do you avoid? 

you could look for opportunities with reverse mortgages in default (backwards marketing) and tax defaulted property (the last group can be difficult to sift and sort due to large quantities).In the end, you’ll do much better focusing on solving problems that others cannot or are not willing to solve (hoarding, squatters, liquidity, defective title, skips, etc.).BTW, I started with working foreclosures (1978) and then deceased owner and title-impaired property about (35) years ago and have closed several thousand deals to date.  

I'm going with 2 sentences...Tax benefits are secondary to the value of the investment...The large percentage of wealth held in retirement accounts is particularly notable given the tax advantages these vehicles offer.

I owe approximately $2000 in property tax on that property.

This does not include the tax write-offs for new systems and the expense of installing them.

Or do I owe taxes on 240k minus - 68k = 172k ? 

We do not have a phone conversation nor do we have a face to face conversation so that we avoid conflict.

My debt/income ratio is lower than it really is because I own alot of rentals so for tax purposes and depreciation, my taxes dont show the whole real picture.