This is why I recommend you market through ordinary channels for anyone looking for a long-term rental.

I will suggest something that is out of the ordinary but works for my parents.

It's just an ordinary bank account where you hold funds on behalf of another and it's separate from your funds.

The whole house was repainted, laminate hardwood floors laid in the living areas, new baseboard trim, new carpet in the bedrooms, new tile flooring in the bathrooms and outside patio, granite countertops in kitchen and all bathrooms, stainless steel appliances, paint the cabinets, new toilets and plumbing fixtures, new lighting, and all tubs and surrounds were refinished.

*Exterior Before*Exterior AfterPool Before Pool After (Full Re-screen, Patio Washed and Painted, Landscaping Mulch, Fence Pressure Washed)Master Bath BeforeMaster Bath After (New...well everything)Kitchen BeforeKitchen After (New everything except Floors which were cleaned and buffed)And finally...Guest Bath BeforeGuest Bath After (New everything but Window and Tub which was Refinished)There were more photos of course but I figured these would give you a good enough idea of the old vs. new.  

Quote from @Joseph Palmiero: Yes, you need to claim the rents received as income and claim the rents paid as expenses.And assuming the rent expense is ordinary and necessary and directly related to the business. 

"ordinary and necessary" for the production of rental income and 2. for a reasonable amount.I think the case for both of these should be easy to make.We are on good terms with the tenant and expect to obtain a Buyout Agreement before the year end.

Even if you have one entity, the income from rental will still be passive and income from Flips will still be an ordinary income.

I went out into the Garden to look and straight away noticed a horrendous sight- they had chewed their way through our solid mahogany patio doors which is four inches thick!

They did it so they could capture ordinary income from dealer/developers who hold property more than a year.