If one partner's personal mortgage is being paid with the rents isn’t that considered a distribution out of the business to that one partner, giving him more taxable income for the year(compared to everyone else?)

It is always deductible for you, but it becomes taxable to him.

Depreciation reduces the amount of taxable income as you take it, and then you pay the taxes on that amount when you sell.Your "effective federal tax rate" is not relevant on any additional income above whatever amount you're calculating that effective tax rate on. 

Years after that those gains should be taxable if she is holding for investment property and not personal residence.Personal residence you have other exclusion amounts for non-taxable. i think it's single 250,000 and married 500,000 and then taxed after that.

There's several semi-private lenders (Visio and B2R are two that come to mind) that have no limits on number of properties or taxable income issues that can result with multiple rentals.

We have depreciation to help you lower your taxes, which is about 18.18k ( 500k property value / 27.5 years depreciation ) of non taxable income.

The provision retains 20-percent bonus depreciation for property placed in service after December 31, 2025, and before January 1, 2027 (after December 31, 2026, and before January 1, 2028, for longer production period property and certain aircraft), as well as for specified plants planted or grafted after December 31, 2025, and before January 1, 2027.EBITDA add-back computation for interest expense: The provision extends the application of EBITDA to taxable years beginning after December 31, 2023 (and, if elected, for taxable years beginning after December 31, 2021), and before January 1, 2026.

@Basit Siddiqi: I realize every thing depends but:Re: Depreciation Only, Generally speaking, if I have an income of $300,000 as a W2is the general idea that if I buy a long term rental at $300,000 and assume that 80% is building, I take $240,000 divided by 27.5 years & I reduce my taxable income by $8,727 ? 

Thus, the reward is worth the risk to me.If REI's are able to move every 2+ years in your primary residence, more people should consider the non-taxable gain....as you say "make a killing".

If you do not run into those usual expenses before selling then as well as the appreciation profit (which is taxable if you dont "roll it into another property") you would also have that 38K profit that you have already paid taxes on when you claimed the rent.