how much loss you can take against your other income which depends on if you are passive or active. You also have to recapture the depreciation on a sale. If you hold forever for the time being there is a step up basis.

The part about your income going back to the business so isn't income is not accurate. You have income and expenses it doesn't matter what you do with the profits. The depreciation expense will increase expenses and you may have other business related expenses that decrease your profits. But whatever your income is after those expenses is your taxable income.