It's a tax on the gain.How is this calculated?

The era of "everything prints money on Airbnb" is LONG GONE! 

In this case, since they are borrowing their payments, these would get added to the principal balance each month, and interest would be calculated on that.If, for example, the interest rate on the note were 10%, they would implicitly be borrowing their payments at that rate.

Honestly, it seems like you’ve got more skin in the game than I do since I’m just getting started as a bird dog, but I really admire your approach.I think your focus on tax-efficient strategies and building a reliable team is spot on.

But you should judge your PMs on more than just price.

Most, if not all are in older neighborhoods without a HOA and on the bus line. 

First time on this forum, and just introduced through two books I just read by David Greene and Brandon Turner.  

In terms of maintenance, they are generally safer because you are not responsible for the exterior and common areas and potential leaks, etc.

It's up to their tax professional on how to present that info on their tax returns.

@Lulu LueHUD has 2 online databases of lenders showing which ones have the most experience with 203k's.