Long term residential rental property produces passive income. If you have a mortgage on the property, your chances of actually showing a taxable profit are nil.
When you add up the deductible rental expenses of Mortgage interest, property taxes, insurance and add that to the depreciation you are required to take each year, the total of those four deductions alone will most likely exceed your total rental income for the entire tax year. Add to that the other allowed rental expenses (repairs, maintenance, etc.) and you're practically guaranteed to show a loss on paper, at tax filing time.
So don't worry about underpayment penalties. It's not gonna happen with your typical long term rental property. If you did have any underpayment penalties, I'm highly confident in stating that it won't be because of your passive rental income at all.
