Then you should look at the markets you're interested in to determine which ones will help you accomplish your why and goals.

Generally, when most properties are sold at auctions the junior liens are wiped out with the exception of IRS and maybe liens by the state for back taxes.

@Justin BrownYour CPA would be the best guide to determine what your gain would be if you decided to sell at your desired price as he would know your adjusted basis, tax rates, etcThe three most popular ways to defer taxes would be 1031 exchange, QOF and installment sale.

Any one or more of those things can cause you to have a higher or lower tax bill in any particular year.Just because Robert Kiyosaki famously called rental real estate "zero tax income," doesn't mean income taxes are zeroed out, globally.Here are the instructions for Schedule E: https://www.irs.gov/pub/irs-pd....

Hello @Srikanth Raj  I think first off you should determine what you are looking for in a turnkey property as there is a vast difference in what is offered from one turnkey provider to another.  

Tax is not determined by your debt. 

That will likely determine if we are going to build a SFH and sell it or try for a duplex and keep it as a rental. 

How does the IRS and CRA look at this in that instance?

However in recent years there are some private letter rulings and case law that indicate the IRS is softening its stance here.  

. $50k K1 loss3. no tax on distribution during the entire 5 years because of $50k loss.4. at the time of sales, you still have $20k loss left5. at the sales (~2.5 times multiple), you get ~$200k back ($100k original capital + ~$100k profit).6. you owe IRS capital gain for $80k + recapture of depreciation, depending on your income, up to 20%.If you don't do anything, then you pay IRS long-term capital gains tax and it's all done.However, if you invest all the proceed of $200k in the same calendar year on a deal with the same terms, then you generate $100k paper loss effectively offsetting capital gains tax from the first deal.It seems like you will eventually run out of paper loss unless you put additional money in. however, you can defer the tax quite a bit.You can continue to do this until you die.... when you go, your kids will get this tax-deferred investment on a stepped-up basis wiping out the tax liability.Am I understanding it correctly?