This is illegal and highly regulated.

Bottom line, take the time now to learn your state landlord tenant regulations.

While it may seem asinine to you, the process has to be consistent throughout the portfolio and, the process is both regulated and enforced by both state and federal regulators....AKA the government.

However, I would recommend getting a second opinion from your CPA (partially because Treasury Regulations can change things, particularly definitions, even after we have the new law in the book).

If you do a lease option in NC, make sure you understand the regulations associated with such a program. 

Treasury Department and Internal Revenue Service are working on QOF guidelines and regulations.

It is also why banking is heavily regulated.

@Robert Naucke Jr, the requirement that one must be accredited to invest in certain alternative asset classes is regulated by the SEC, so no, no way around it... unless that person/company wants to go to jail.

Send the resident tennat and their handler a rent increase notice according to your state regulations.

Until you officially take ownership you have no authority to offer any changes.You need to spend time studying your state landlord tenant regulations.