They make money if you keep them rented.Also be aware that if you are claiming up to $25K loss against your ordinary W2 income, you need to actively participate.

If you did AirBNB, that would be ordinary income and fall on your Schedule C. 

You need to speak with your CPA on this as the BP community is not licensed to give tax or legal advice.Intent plays a huge role in the taxation of ordinary income from a “flip” or capital gains from a buy and hold.

Flipping is taxed as ordinary income. 

Presuming this is 1099 income, I'd first focus on all the ordinary and necessary expenses tied to YouTube income. 

His 500K of 'gain' would consist of 200K of depreciation or 33% of sale price (that needs to be recaptured) and 300K or 50% of sale price of capital gains.So IF I am understanding right, 33% of the down payment would be taxed as 'recapture-able depreciation' and 50% of the down payment would be taxed at capital gains rate.Likewise, each and every payment would have those SAME proportions taxed that way on the PRINCIPAL PORTION only, and then the interest portion would just be taxed as ordinary income?

Profit is taxed at your ordinary tax bracket.Not a CPA, consult a cpa as this isn’t tax advice

@Candace PriceA lot of factors go into the rates provided.The asset, location, your net worth and liquidity, your experience, your SREO, the property financials, your relationship with the bank, your down payment, etc.Assuming you’re good on all fronts. 3.5-4.0% wouldn’t be out of the ordinary with some IO on the loan.

for my first one I would think I should be looking for something better, but I could put a measly $5k down and my cash on cash return is almost 20% if it rented for what it currently was (tenant leaving now).. only cash flowing $100 though.Being a 1 BR it seems like if I ever want to sell it would be to an investor only. any reasons not to pursue it, or could this be something good to get my feet wet?

Profit from flipping houses is taxed as ordinary income