Your argument would suggest that if I bring home $2k/month in cash flow from a rental property in LA (where I live), that's a good deal, even though I probably had to put $2M cash into it initially.

You'll have an option between the FHA househack 3.5% down and the conventional househack 5% down - if you're VA then even better though. 

Your question has been debated between BP tax experts both privately and publicly, for example here: https://www.biggerpockets.com/forums/51/topics/819991-expens...And we ended up where we started: no consensus and no clarity.There have also been court decisions that support my interpretation, even though I personally find these court decisions debatable.

But I'm getting a pass because the IRS does not verify and does not even ask.Don has a more difficult time with his auditor because he does not have Form 1098, and he does not want to show a form with my name on it, for obvious reasons.

With the idea you get your 6k back when fund deal/deals  MLM all the way sell the futures and the deals that Cogo did pay me off on as you stated took forever to fund and the rates were even higher than mine :)  Its just a very good Guru selling his stuff we all know they make the money selling the 6k how to become a lender. :)  

From there, I would start to run numbers on those deals in that area/streets, and then start to connect with local agents/PMs to get an even better feel for pricing on homes along with rents for them. 

Many judges would feel you got paid even if no cash was sent to you.I could see this potentially working on a higher-end property that it in excellent condition with a Grade A tenant.  

@Bayo Badejo, there are so many missing pieces here to even begin to give a real answer.What insights are you wanting?  

I appreciate that, and you're right, any back-of-the-envelope calculation suggests that much of the wealth comes from the equity accumulation, even in the earlier stages of the amortization schedule.

There are never full photos of the mechanicals and basement and roof line so you will never have even a bare inkling of what the potential repairs will be.