I just wasn’t sure if this scenario fell under one guideline or another or if anyone in the Denver area knows of specific rules.

I think it may be over priced as it doesn't pass some of the rules of thumb I've seen on BP but it's about a close as any of the properties in the area get.      

Similar to RRSPs, you can pay yourself out slowly when you are older to reduce taxation.Always good to check with an accountant to be sure what the rules and regulations in one's area is.

Recently I applied for HELOC to buy another property and got rejected since they thought my DTI was so high.

I even assumed you had to live in the property for a year before you qualify for Heloc,, but I have found that you can apply 1 month early if you sign something saying you will make subject property your owner occupied within a month,..

I'm applying for a HELOC tomorrow, I've made up my mind!

Regular maintenance and upkeep on the house itself is not occurring.Your renter disregards the covenant rules as well as Jefferson County laws.

You're in the Bay Area, have great income and enough money for a down payment, but none of the deals locally make sense because the numbers simply don't work on paper.You're a first time investor, so you aren't willing to take too big of a risk... that often rules out investing too far outside of state.

One just need read the law for a very easy understandingThe preceding sentence shall not apply to any foreign taxes described in subsection (a)(3) or to any taxes described in paragraph (1) and (2) of subsection (a) which are paid or accrued in carrying on a trade or business or an activity described in section 212.And then the reference from the above law to IRS Code 212(1) It has been paid or incurred by the taxpayer during the taxable year (i) for the production or collection of income which, if and when realized, will be required to be included in income for Federal income tax purposes, or (ii) for the management, conservation, or maintenance of property held for the production of such income, or (iii) in connection with the determination, collection, or refund of any tax; and(2) It is an ordinary and necessary expense for any of the purposes stated in subparagraph (1) of this paragraph.And for even simplified version, just look at the IRS guidance on the subject...What Deductions Can I Take as an Owner of Rental Property?

Does the depreciation of the property apply to local income taxes as well?