Use umbrella insurance as an additional safeguard, especially if you opt not to form an LLC.Avoid S-Corp taxation for rentals, as rental income is passive and not subject to self-employment tax.

This is very useful.You could build a deck or gazebo to house a hot tub.

Quote from @Craig Parsons: So this here is a hot mess. 

For a rental property, the gain is subject to capital gains tax (15-20%) and depreciation recapture tax (up to 25%) on any depreciation claimed, unless the proceeds are reinvested.To minimize taxes, consider reinvesting the sale and insurance proceeds into another property under §1033 or converting the property to a rental before selling to claim depreciation deductions.This post does not create a CPA-Client relationship.

This will cost money to maintain, cost money to manage leasers, subject you to the will of tenants/leasers should they damage something, should someone get injured, your money will be gone (for now), subject you to the will of the market, interest rates, potential market volatilities.. you will need a lawyer at that amount for sure and a good CPA. 

I believe that the technically correct answer is that they all moved from California to Texas and Florida, whereupon they realized that it gets extremely hot and humid in those places, has extremely variable weather, and large insects, and are now leaving Texas and Florida. 

This helps keep me out of hot water with fairhousing. 

If you don’t itemize, you won't be able to claim the deduction.Limits on Deductions: The amount you can deduct may be subject to limits based on your adjusted gross income (AGI).

When you go to sell, you're subject to tax on the amount of profit between your adjusted basis and sale price, not your purchase vs sale price.Recapture is not repaying the depreciation.

My understanding is profit from lending is considered "taxable income" and is therefore added to your income and subject to your normal tax rate after all deductions, etc.