Assumed this rental property generates tax losses (due to depreciation) - I understand I can deduct these losses from normal W2 income that my wife earns. 

Trying to determine whether to take the loss or keep moving forward. 

If it's an investment property, major improvements will get added to your basis, so no immediate deduction, but will get subtracted out upon sale which lowers your capital gain eventually upon sale (or increases your loss). 

They were negligent and therefore responsible for your loss.

I am only about 20% DTI.got it but for many with out a W 2 its very hard to get a loan.. many show loss's and that alone will keep you from getting a loan..my main point is lenders are not going wild giving out loans like they did pre 08 ..

Monthly Operating Income Scenario A Number of Units 3 Average Monthly Rent per Unit 1,250.00 Total Rental Income 3,750.00 % Vacancy and Credit Losses 5.00% Total Vacancy Loss 187.50 Other Monthly Income (laundry, vending, parking, etc

Depreciation, mortgage interest, taxes, insurance and any HOA dues shown on Schedule E may be added back to the net income or loss.

So while there was a lot of loss I don't think there are a lot of newly homeless people without a place to go because of it.

Its best to start small to take the losses in case of failure.

If investor is running a negative cash flow speculating the appreciation will increase one's equity, what happens the investor can not afford to put in when there is a job loss?