Should I file married filing separately so I can deduct my real estate rental property losses since my income is below 100k? My income is 94k and my wife's is 114k.

No, if you file married separate and you two lived together for ANY part of the year, you lose the right to deduct ANY rental real estate loss.

f you do not claim depreciation, then, when you sell, you must reduce your basis by any amount of depreciation you took or COULD HAVE TAKEN, so not taking the expense means you lose a chunk of loss carryover and still have to claim the depreciaton amount when you sell.

Anita01 is correct.  According to the IRS Instructions for Form 8582:

Active participation. If you actively participated in a passive rental real estate activity, you may be able to deduct up to $25,000 of loss from the activity from your nonpassive income. This special allowance is an exception to the general rule disallowing losses in excess of income from passive activities.

The special allowance isn’t available if you were married, are filing a separate return for the year, and lived with your spouse at any time during the year.

When a married couple chooses to file separate tax returns, they both *automatically* lose a large number of tax credits and deductions they would otherwise qualify for if they filed separate. Additionally, the allowed SALT limits for both are cut in half.

Your rental expenses filng MFS will also still not be deductible. See IRS Pub 527 at https://www.irs.gov/pub/irs-prior/p527--2019.pdf  page 13, "Exception for rental real estate with active participation" and pay particular attention to the caution note which reads, "he special allowance isn’t available if you were married, lived with your spouse at any time during the year, and are filing a separate return."

Also, for the rental losses see page 14, first column, about halfway down, "Maximum special allowance"

It's best to actually read the entire section starting on page 13 "Passive Activity Limits" so you get things in the right context.