His response was that money is being washed and parked.

In many cases, you could also drop down to a 25 year fixed, keep your payments ballpark the same (higher P&I payment, but no mortgage insurance, so a wash), but end up debt-free years sooner.

They just aren't very popular in my area.I have a private maid service that cleans the house washes the sheets and remakes the beds.

I'm pretty sure I could research and find the correct/safe/legal (as you all seem to put it) manner in which to remove/dispose of these potentially hazardous materials along with the right chemical/cleaning agent to pressure wash any meth residue from the structure's skeleton...With all that said, it doesn't seem like much fun and I think I will pass on this deal, and by the way I would be giving the same advice as everyone here if some anonymous "investor" asked about this online... so I appreciate the words of wisdom.The thing that isn't clear to me is: would I, or would I not be breaking the law by continuing with my "plan"?

If I sold him the building on a land contract for $250k, which is exactly what I have in it, on a 15 year payout, am I correct that the sale would result in a wash, no earnings to be taxed on, and the only taxes I will pay will be on the interest portion of the monthly payments for the next 15 years.  

Unless you pay cash for this deal...I can tell you that this deal will be close to a wash.  

You see, I currently wash dishes for a local restaurant chain during the day, bring in barely 1k per month in income (after taxes), a little over half of which goes toward living expenses, and use a bicycle and the local transit system to commute around town since I don't own a car.

If friends are not willing to let you show the place and leave a mess behind, then at that point you should simply reconsider your generosity to someone who doesn't have the same respect and consideration for you.One hand washes the other.

We haven't had a formal sit down , but all he kept saying was he wants out.

Not only does it make the house stink, but there's a lot of extra labor involved (i.e. washing/scrubbing walls) whenever it's time to repaint.