Do you show income on tax returns?  

The current appraised market value of the property at the time of distribution would be taxable income to you.  

I am a new business owner of a fitness studio and have always been interesting in using real estate to earn passive income.

They are asking 299,900 Land locked, no room for expansion.Total Income     22,187Insurance              189Liability Ins.           767Interest Expense   174Loan Interest     10534Labor                  6400Repairs                 646Supplies                90Taxes                 2532  (Not sure what value amount this is on)Telephone            841Utilities (G & E)     802******I talked to commercial lender today and he said they require 30% down, financed commercially at possible 5.3 to 5.6% + for 15 or 20 years.  

Now let's look at the numbers (Monthly)Average rent/unit = $775Gross Income with 94% occupancy = $24,02550% gross income for expenses = $12,012Bank Mortgage payment for $1,875,000 @ 4% 30 year = $8,952Seller finance $375,000 for 6 years @ 4%, with interest-only payments = $1250Private money loan payment for $300,000 for 6 years @4% also with interest only payments = $1000Subtracting all expenses and debt service from gross income gives me = $811 in cash flow which I would set aside to use only on the property.

I know it takes time and work but I would much rather work hard now to be able to get this to be my source of income sooner rather than later!

It's a golden opportunity because my uncle is also willing to sell it to me for a small amount upfront, as long as I structure it properly so that he'll get the full value over time or gets made whole through the rental income once we have tenants in.

Should I put a percentage of my rental income aside or should I pick a set amount?

You are going to want to verify income and rental history at minimum and learn how to evict non-paying tenants if you intend to manage yourself.

I am looking for a tax advisor in the Kenosha area to help plan tax strategies for my real estate income and my passive income.