Lynn911 Dallas Realtor & Consultant, Credit Repair Advisor
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Example $1,374/month mortgage(Principle $200K loan @ 5% interest, taxes & insurance= $300) with $1,374/month in rent. Assuming year 1 of the rental with no other expenses your cash flow= $0. The tax liability at year end for the property would be $2,951, due to principle payments in first year. Deductions are Interest=$9,933 Taxes & Insurance=$3,600. Total rental Income $16,484 - $9,933(Interest)-$3,600(Taxes and insurance)=$2,951 Taxable Income.
Good Luck and due your due diligence on the property!
Disclosure: Please check with a tax professional about your personal circumstances.