Just Breaking EvenWhile breaking even is better than a loss, it's generally not ideal.I would aim for properties that provide positive cash flow immediately to ensure you're making a profit after all expenses.

If so then folks could sell real estate, book profits based on the value of the Gold, but log a transaction that was technically a loss (tax write off) based on the face value of the legal tender.

My further step will be to go even lower and take a 10k or 20k loss that I might use for my tax return next year before the hard money debt becomes even more. 

There is loss opportunity costs.

However, the money I’d save by not paying $3500/month mortgage is $42,000 after 12 months – thus recovering the money paid on the capital gains tax.QUESTION: would you advise selling the rental to pay off the new home and take the $1400/month rental income loss (and gain $3500/month savings) or would you advise keeping the rental?

Our first plan didn't work and we would have had to take a loss if we sold it.

@Sonal Chopra first it would be a loss of a family member which is never a good thing to lose someone.For the sake of the exercise.

It should be noted that, under many software policies, your account could have been permanently deleted after 30 days of nonpayment, with no way whatsoever to recover your history.

No lender will qualify your income earned from a short term rental based on a profit and loss.

I feel that the coinvest should be meaningful enough to cause real pain for the GP in the event of a bad outcome, but not so much pain that a bad outcome or 100% loss ruins them or threatens to disrupt their lifestyle either.