This has three implications:Income from these investments is taxed at your ordinary marginal tax rate.Any losses can be used to offset other passive (and only passive) income, thereby lowering your overall tax liability.

Depreciation is a lot better tax deferral mechanism than IRA and long term capital gain tax rates are lower than ordinary income rates applied to IRA withdrawals.

The real estate professional status (IE what is required to be able to offset ordinary w2 income) REQUIRES more time on REI than any other activities. 

I don't know what sort of recourse they might have against you for divulging this information as part of your ordinary course of vetting the applicants.

The cleaner it is, the cleaner they will keep it and the easier it is to identify anything beyond ordinary wear-and-tear. 

whether an item can be expensed depends on if it is ordinary and necessary(and reasonable).It would be hard to argue that a random MBA is ordinary and necessary to your business.Maybe a class that is very specific to your business.

Your flipping will be ordinary income tax reported on schedule C.  

Either way you structure it you are subject to SE and ordinary income tax. 

@Brit F.This was the best and most comprehensive response on this topic i ever read.

@Brit F.Glad to see you prevailed!