So for ur example, the $200k restoration plus the house value portion the &200k purchase (probably about half, best to get ur county tax records & discuss with tax professional), u end up depreciating approx $300k over ~35 years. If/when you sell, you’ll need to recapture the total amount deprecated against the sale price (ie, it will decrease the cost basis, hence increase the profit subject to capital gains tax on the sale).
the upshot of this thread:
Re: Rental income is total rent minus eligible (ie, tax deductible) business expenses to manage & maintain the property. Never mind mingling in the “mortgage” payment—that just clouds the discussion!
HTH!
