Given that you specifically say "straight line depreciation", it's not clear whether you're asking about depreciation in general, or asking whether the straight line version specifically acts differently. Depreciation in general is often described as reducing your taxable income, but more precisely, it defers your taxable income. Depreciation reduces the cost basis of your asset, so when it sells, the amount of the sale price that is considered "profit" is increased.
Depreciation is a deduction from your income, not a credit. That is, it's not money you're getting from the IRS, at least not directly. Lower taxable income means lower tax, and if you've already paid more than you owe, you may get a refund, but that's different from the IRS just giving you the amount of the depreciation. Since depreciation is larger than your net income, you won't be able to fully benefit from it. You may be able to claim the loss against your other income and/or carry the loss forward. You should check with a tax professional what your options here are.
The decrease in value of your assets is an expense, so it's a bit misleading to give your net income after expenses, when that doesn't include depreciation. The depreciation for tax purposes is, of course, not necessarily the same as the actual decrease in fair market value, but when you're calculating profit, you should consider "actual" depreciation. Your calculated depreciation is more than four times your net income, which should give you pause. Again, that's not necessarily all "real" expense, but some of it is. You should seriously consider whether your making an actual profit, especially since there may be other expenses you're not considering.
Also, I don't understand the line
(LTV * Purchase Price) / 27.5 = $4,092.92 depreciation
You give LTV as 0.8 and purchase price as $72,500, and I calculate 0.8*$72,500/27.5 as $2,1091.