Are you sheltering other income now?
Do you expect to be in a lower tax bracket in the future?

Yes, some sheltering with Fidelity mutual funds.  Tax bracket should remain the same.

Keep in mind tax law changes down the road.

 By owning the building and using it as a rental you have four main issues to think about.  

 First, what is your present return on investment. For example, if the building is worth $100,000 and your net profit before taxes is $1000 a month, then your ROI is 1% per month or 12% per year.  That's about the same as you could do in the stock market today, but the stock market is unlikely to be that good over  The long run. Average S&P 500 return is about 8% per year. 

 Second, in addition to your present rate of return from the rental income, there is the possibility that the building will appreciate and gain in value.    Although that gain is taxable when you sell, so would the gain from any other investment.  

 Third, you will have to deal with the issue of depreciation recapture. When you sell the building, depreciation is recaptured at 25%, and the rest of your gain, if any, is taxed as a long-term capital gain at 15%. 

 Fourth, if you own the building until you die, and pass it onto your heirs, your heirs will inherit a stepped up cost basis and will not have to pay capital gains tax or recapture depreciation when they sell. They will get the entire value of the building as an inherited asset. 

 So the value of continued ownership is the present return on investment, plus property appreciation if it appreciates, minus the taxes you will owe when you sell it. You might want to reduce your estimation of the value of holding the property by an amount to compensate for the hassle and uncertainty of renting to tenants.

Against those factors, you have to think about where you would invest the money, how much risk you can tolerate, and what rate of return you would get if you sold the property. .

Good analysis.  Also remember state taxes.

I'm mostly interested in short-term advantages at the routine micro level (I guess "present return on investment," as you refer to it, Opus, and I thank you for your response).  For instance, if I can deduct 20% of the expenses (my tax bracket), that deduction effectively increases my monthly profit, if my thinking is correct.  

So if I have $800 in expenses, I can tack on an additional profit of $160 to my monthly net income.  And this benefit wouldn't be common knowledge to the casual observer.  I'm wondering if there are other such advantages I'm not aware of.

I didn't know, Opus, my heirs would not have to pay capital gains or recapture depreciation.  That's good to know, but as I said, I plan to sell at some point in my lifetime.

What is the 25% of depreciation recapture? Does that mean if I got deductions amounting to $10,000 for depreciation for the whole time I owned the property, I would only have to pay back $2,500?  I thought we have to pay back the full $10,000 - no?

My ROI is less than the S&P average, but I'm thinking it could get closer if there are other advantages.