Problem:
Mr. A has three rental properties which he rents, but hires a service to maintain the properties. Mr A also have a full time job as a Sales Rep with ABC Manufacturing.
Mr A's rental properties generate $3,000 each month. The depreciation on the properties totals $2,000 each month plus his monthly maintenance fees of $1,500 for the three units. Mr A wants to know how his rental properties can be used as a tax advantage. Specifically, can the loss on his rental activities ($3,000 less $3,500 = $500 loss) be used to offset his W2 income? Why or why not?