You can write off more things on a rental. These include: depreciation, insurance, maintenance, and anything related to managing, marketing the rental, etc. Depreciation alone would likely be 10K per year in your case.
You deduct these against the rental income first. Any additional losses (up to 25K, if you make less than 100K) can be deducted against regular income.
I ran a few quick numbers looking at the Schedule E – and my tax write-off is a few hundred dollars more if I stay in the place, versus renting it out as the rental income is greater than what I can write off for depreciation+HOA.
So I’m back to the 70K I’ve already lost in value, plus any additional depreciation over the next 3 years.
