yes virtually every street in sojac we had houses on and for sure i funded fix and flip on them. keep in mind from 2003 to 2008 i was by far the largest HML in the market place.. you has SIF that was also there but were 4X bigger in volume.

(sorry if this screenshot shows up small in text, I don't see any way to make it bigger. when I edit the post it shows bigger, but when I post it shows up small.

We calculate gross income as all dollars coming in except taxes.Our clients gross revenue is the room rate (top line) expenses minused out and then they receive their net income.Net profit (or loss) would be then when they subtract debt service, property tax, insurance, utilities, etc.

Welcome to Bigger Pockets !

Move on, cut your losses, learn from it and invest in better markets next time.

Welcome to Bigger Pockets, Clayton!

And if they're smart they can maybe get a tax break for it, if they can show a loss on paper.

( Not sure if that's the correct terminology.)Whatever loss I take in the first year against my wife's income, does doing this change my rental income from being passive to non passive income as well?

And always remember evictions can cost typically 2X-5X than CFK's - But your time is the most valuable LOSS in this all!  

Operating Agreement: This document should outline each partner’s investment, share of profits/losses, decision-making authority, and exit strategy.