I'm a complete novice on real estate issues and would love reactions from you experts about our situation. We're considering moving abroad for a couple of years and renting out our home while we're away (idea being maybe we can at least partially live off the rental income). Rough facts/assumptions are below but we're not sure it's really worth it given that we hope to return to our home and live there semi-permanently. And I'm having a hard time figuring out what the tax implications of doing this would be -- not sure if we could deduct mortgage interest come tax time, and don't think (??) conversion into a rental property would make sense given our plans to return and live in the house (but I confess I am fairly ignorant about what this means). I've been looking through various IRS pages and googling around about applicable deductions but it seems most guidance is not geared to our situation (renting out our primary residence vs. renting out other rental properties we own but have never lived in, or renting out a vacation property), so it's confusing. My husband's gut reaction is that it wouldn't be worth it at the end of the day, but I'm a little more hopeful.
What I want to know is: (1) how much (if any) U.S. federal income tax would we owe on the rental income, assuming this is our only income? and (2) how much cash would we net after taxes, operating costs, etc. (which we could then use to help fund our living expenses abroad)? Could anyone point me in the right direction for figuring this out, and/or offer informed thoughts?
Home value: 800,000 (about half paid off)
Remaining mortgage: 400,000
Our monthly mortgage payment (including mortgage interest - about 14,000/yr; property taxes - about 8,000/yr; insurance - about 1,500/yr): 2,700 (x 12 = 32,400 yearly)
Expected rent: 4,000/mo; 48,000/yr
Let me know if I'm leaving out any critical information here. Thanks very much!