Thank you, Ward Conville @Ward Conville ,LAW: Under IRC § 469(c)(7) & Reg. 1.469-9, if the taxpayer spends the majority of his time in real property businesses, meeting the 1/2 personal services and 750-hour tests, rental real estate losses are no longer per se passive.

I found this information as far as lisce se exemptions...

From the purchase price, I guess this house is in Cordova, nicer area of SE memphis, or maybe Bartlett.So it is probably in an "A-" or "B+"  neighborhood.Again, if it has had a super renovation and really good PM, the numbers can work.  

It is a red flag per se, but not a deal breaker on its own.how a landlord manages their property plays a big role in the regularity of tenant payments.

It's not "normal" per se, but it does happen.  

I'm actually afraid to ask what the definition is since in DC these so called lawyers, doctors and professionals are gentrifying areas like Anacostia and Congress Heights in SE DC.

thanks,Pat I'm a bit late to the party here so my apologies.Had a great call with @Drew Sygit about a similar topic.Wealth of knowledge from Drew and if you are still looking at starting a PM business, highly recommend you connect with him if he is available 😁100% agreed with @Nathan GesnerWe started PM in Toledo as a subsidiary to our turnkey outfit.Took us 5+ years to figure S#@% out lolSo definitely start "1 by 1" unit per se and grow organically.We are at a point just now where we are looking to scale via M&A.And that is only because I feel that we have reached our peak when it comes to generating organic leads.We get regular lead form opt ins and calls to our office.Literarily "monopolized" Google with SEO and our good reviews so there isn't much else to do IMO.Only issue I see is we aren't looking at expanding out of city and will stick with Toledo for now.Which will limit us in terms of expansion.Much success and all the bet with your business

SE Asia this time.

However, rental income is passive and not subject to SE tax, so that is just silly. 

There could be other issues as well, if I were you I would look for other ways to generate SE income, perhaps you could flip a property or two, etc.