Once in service, expenses become deductible, reducing taxable rental income.This post does not create a CPA-Client relationship.

My thinking immediately turned to researching local rental costs per square foot to determine income potential with triple the current square footage.

Buy and holds is the key to true wealth with all the benefits of depreciation, appreciation, loan pay down by your tenants, leveraging the equity, cash-flow etc etc, but it often times isn't the active income that pays the bills until you build up a portfolio and even then there's the tenant management or managing your property managers.That's why I'm involved in all 3.

Building a strong foundation with reliable management reduces risk, allowing you to reinvest the passive income strategically and grow your portfolio steadily without over-leveraging. 

For example, I see newer investors attempting wholesaling or bird-dogging for other investors to generate additional income to invest.

I own a small portfolio that brings enough income for me not to have a w-2 income.

Rental income carries the debt service 100% How did you find this deal and how did you negotiate it?

Chances are, they will avoid you because they are not planning to report this income.

Typically, I run a current income/expense column next to a ProForma column to show potential value add opporunties.I agree with @Robert. 

I’m an investor and student of the game when it comes to building passive income and a solid portfolio.