Tax question. Total cash flow or AFTER income - expenses?

[Min Kim]

Dumb question or maybe I’m not thinking this correctly.

What’s actually taxed? The total cash flow just after the mortgage is paid? For example;

Mortgage payment $1000, rental income $1500. So is the $500 that’s being taxed?

Or is it AFTER the expenses ie the "reserve funds" (HOA, Vacancy, repairs, CapEX)? So in actually, more close to $150 that's being taxed after mortgage ($1000) is paid from the rental income ($1500)?