This issue is SOLELY the one misdirected payment.I stand by my characterization of your advice.

@Allen McGlashing, your situation is extremely common and simply being in a loss position alone would not cause the IRS to characterize your activity as not for profit.  

See bottom for more on this rule.The only affect the Tax Cuts and Jobs Act of 2017 (P.L. 115-97) had on IRAs was the repeal of the rule permitting the re-characterization of Roth IRA conversions.

Nor is it the "easy way out," as you've characterized it.

We also do HML's and we will only lend to entities to ensure that there is no characterization of the loan as a consumer loan.

My experience and opinion couldn't be further and more contrary to your  characterization and implication.  

They are characterized by "liberal n/o/o HELOC," I can't specifically comment on the 20 year draw thing... not that it matters since a HELOC can be cut off at any point in time, without notice. 

How would you characterize the level of contractors?

I wouldn't characterize the market as a seller's market any longer.

The court concluded, “the Complaint alleges statements that characterize Troptions as an appreciating asset and convey that Troptions holders can rely on the promoters to see an increase in value and use.