A C corp is subject to double taxation in the form of the entity paying tax and then you paying tax on income received on earnings.

It will make a difference in your analysis as there are several differences w/r to finance and taxation.

Now this is kept simple for this exercise and I am not going to look at real cash flows or taxation effects.So, you buy for $500,000.00 and get a mortgage for $400,000.00 and spend $30,000.00 on improvements.

Therefore, you do not have to worry about double-taxation from the states.

A entity isn't a license to cheat on your taxes.Disadvantages - Double taxation. 

Brokering, wholesaling, birddogging, and anything like that are all ordinary income and subject to income tax at your ordinary rate.

I think I had read one of your posts about double taxation in Memphis area, and was basing my conclusion off that. 

The Power of Zero and . . . .anything from Robert Kiosaki make very clear points that the government is running up an increasing tab . . . one that is paid ONLY through taxes . . . unless we change to a very different modus operandi (namely empire building) then taxation is the way to reduce the deficit.  

You can also do special allocations as you mentioned but make sure you have a good CPA if you're going to do that, who understands partnership taxation.

With rent control and increased taxation seemingly inevitable for San Diego landlords (considering local and state government LOVES framing us as the greedy bad guys) I think the writing is on the wall, and now/soon is a good time to sell.