@metu Namaste ji
Before one can answer
(a) Are you US person ( citizen/GreenCard/Resident for tax purposes )? If yes, you are taxed on your world income, file on form 1040, rental income reported on Schedule-E. If not , then you are taxed a NRA, file on form 1040-NR -- you are taxed on your US sourced/connected income. Your rental income is passive but US sourced. Also the state ( CA?) would want a cut.
(b) Are you planning of buying housing only for purposes of income or you plan to use as own home. Note there is at least a 1/4 point penalty for rental property mortgage.
(c) If buying residential property, are you proposing use of entity ( SMLLC, Partnership etc. ) or under your own name ?
(d) if you are a US citizen or GreenCard, which country are you a citizen of ?
(e) Real question here is what are you trying to achieve ?
I will circle back once I hear from you --yes ?
Namaste ji
