Unfortunately once you head into the suburbs the higher taxes really eat into cash flow. 

@Tyler Ferguson It will be a little easier for your taxes and finances if you create a separate account for all of the property's income and expenses including the personal and rental part.

A lower "purchase price" presumably would help both of us from a tax standpoint, but hurts me on depreciation?

Prepare some money upfront because that would be required prior to final settlement.

@Anthony Warlick at 1.25M at 8%, assuming 75% LTV your payment would be 6879 without taxes and insurance (since that wasn't listed here).

FHA loan with monthly payment including taxes about 7800. the other side would get up to 3200.

Did you have any losses and do you know of any under the prior owner2.

Still, the bill still doesn’t allow landlords “to refuse to rent to a tenant solely because of prior evictions or alleged damages” or “solely because of prior convictions or arrests” without “reference to additional information provided.” ... 

How would that affect his tax situation if at all?

A lot of my investors are just buying A-class for the tax benefit and breaking even.