Absolutely agree 100% We are on the same page. The reason to place your properties into LLCs is for the liability protection. As a side benefit if you avoid taxes that is perfectly legal. https://apps.irs.gov/app/understandingTaxes/whys/thm01/les03/media/ws_ans_thm01_les03.pdf
In this case an LLC has operating expenses. The LLC would then offset its revenue, same as any other company. Not sure what a creature is.... The IRS does recognize the LLC's TIN and accepts tax returns in the form of a 1065 which generates K-1 for the members to use on their personal returns. Regardless of profit or loss.
At the end of the day, doing all of this setup probably does not make sense for most individuals. If you have multiple properties and multiple members and the house you are renting is one of many the LLC owns, it may make sense from a liability perspective. But I'll close by saying if you are a single member with a single property this setup may have the appearance of being created without a profit motive.
