Tax saving strategy for long term
Hi! I just started educating myself on rental properties a few months ago and am trying to determine my strategy. My husband and I both work and have a combined income of $220k but we are paying $60k annually on taxes. I would like to purchase real estate for 1) tax benefits 2) long term appreciation and equity.
We just had our first baby and are planning to add another one in 2-3yrs. With this addition I plan on stopping my work for at least 5 years to get them into elementary school. At this point my husband will most likely be earning about $200k at his current role.
We have enough invested in low cost index funds that it should get us to retirement without any further contributions.
My current strategy is to purchase a duplex now while we are both working and have extra income and once we have our second kid and I quit my W2 job and claim real estate professional status. With this status I could claim deductions on the W2 income.
question:
1. Are there tax benefits if we just have one duplex or how many properties until you see a significant reduction in taxes (ideally save $30k annually)
2. Is saving money on taxes just a pipe dream?