If the goal is to offset your high W2 taxes, it seems like you have two possible routes: Your wife could qualify as a Real Estate Tax Professional, or you could use Bonus Depreciation on your Short Term Rental to create a paper loss.

@Maria G. office equipment is depreciated over 5 years, but the computer should qualify for bonus depreciation allowing you to take 100%.

If you can itemize the 25k into let's say appliances and such, you can take 100% bonus depreciation on the appliance and such. 

Network with Wholesalers and more agents. offer the agents a bonus of a few thousand dollars if they find you a deal.

We also wanted to be able to take advantage of the 'bonus depreciation' -- and while reading through the IRS regulations on this, for real estate, it looks like 'placing in in service' has a varying definition. 

Lofts, dining rooms, and bonus rooms can all be converted into bedrooms.

Linky link.Snip 1, more or less as expected, no reference to any first time homebuyer or "does not own other real estate" requirements:Snip 2, with an Unexpected Holiday Bonus relevant to high cost of living areas like NYC, the San Francisco Bay Area, LA, San Diego, DC/NoVa, etc."

These condos usually target Chinese tenants that works in online casinos.

@Michael Plaks I figured he wasnt able to take against other income, and a cost seg that produced bonus depreciation etc would still help.

@Frank Hernandez   land in the path of progress is a very long time play.I have one that I bought in 1992 and it just got brought into the city a year ago.. but its still going through the development process probably another 2 years. and as long as the economy holds.. lucky for me the Indians built the largest casino in Northern CA. right across the street from me and brought in all the streets sewer water power etc. paid for the stop lights at the new intersections they built etc etc..