I don't need to get into why, it should be obvious.No sophisticated investor uses them.

It wasn't the messiest thing I've seen, but still required clean up on my end which the clients weren't happy about at all.The third client is a self employed hair dresser and she compained of poor communication, inability to understand what they wanted form her and complete confusion over their payroll directions.For the price paid, I'd say the results were mediocre at best.

LLC with S-corp election saves you the double taxation, you can put yourself on payroll as a W2.

He is getting more sophisticated.

Do they pay for vacation pay, medical insurance, workers comp, payroll taxes, PTO & holidays, ongoing training, trucks & commercial vehicle insurance, liability insurance, admins, marketing, SEO, liability insurance, bonding fees, licensing fees?

. - there are numerous ways to achieve sweat equity from boring but true rehabs, to development, to various localized sophisticated options

(That would not even include payroll for my W2 TC and admin). 

During our conversation I would understand that the plan would be to have enough cash from payroll saved by the time you closed to use for down payment, and that is completely fine. 

I am willing to go so far as to say they intentionally are seeking investment sources who don't have the means or sophistication to conduct appropriate diligence.Sadly social media has made it far easier for these bad actor capital raisers to get in front of their target audience with ease.

Even looking back at the C/D section 8 type properties I owned at the start of my investment journey 10 years ago, those tenants weren't sophisticated enough to find me anyway even if I gave them a reason to (which I didn't).