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Perhaps I am not the best person to be posting in this thread; I am amongst those who try to educate people about the differences between before-tax and after-tax cashflow. However; I still do not believe that you've established your point correctly, or at least not succinctly. In your...

No, I don't think that it is. The $5,750 cost is after tax, not before tax; see the examples above. And if cashflow is a concern, then the investor can submit a paygw variation and have that tax benefit paid via their wages on an ongoing basis. You are correct though, that this shortfall...

Extrapolating a little... With property incl depreciation: Taxable income (before property): $100,000 Net rental (cash): -$10,000 Net rental (non-cash): -$10,000 Tax: $21,100 Money in pocket: $68,900 Net cost of property: $1,500 $1,500 is also the expected tax in most cases for $10,000...

For 2009 FY: Without property Taxable income: $ 100,000 Net rental: $ 0 Tax: $ 29,600 Money in pocket: $ 70,400 With property Taxable income (before property): $100,000 Net rental: -$10,000 Tax: $25,350 Money in pocket: $64,650 Therefore, property costs you $5,750 to hold, after tax...