take the depreciation, because it lowers your ORDINARY income, which is at higher rates (up to 35%) versus CAPITAL gain which is up to 20%.

That's taxable at ordinary income rates, maybe with SET.Fix and flips make no sense if there's no work to do.

If the need for repair is a result of damage done by Tenant and/or their guests, and not that of ordinary wear and tear, Tenant agrees to pay for the repair.

Furthermore, if your rental activity results in a loss for the year, you can use the net passive loss allowance to offset up to $25K in ordinary income on your 1040.Most of these tax advantages would be lost if your rental property is held in a C-corp.You still have all these tax advantages whether you own the rental property in your own name or in the name of some passthrough entity such as an LLC or an S-corp. .As far as I can tell, there are no tax benefits available to a rental property activity owned by a passthrough business entity that you don't enjoy as a sole proprietor.

Earned interest is seen as ordinary income whether through a business or personally. 

My limited tax understanding would lead me to believe that this would be taxed as ordinary income, not capital gains.

It appears that you bought the property to flip it for a profit.In this case, your profit is Schedule C, ordinary business income (not capital gains) and also subject to the payroll taxes (FICA and medicare).

Hi, I am fairly new to BP and am considering investing in the US. I am quite familiar with financing options and rules in Canada, but the US is a totally different ball game. I'm still in the process of just starting ...

@John T. try this;One idea that I have read about, but never known anyone personally use it is this;Depending on tax brackets for ordinary income (interest) and capital gains, adjust price/rate as needed for best tax treatment.

I don't think that your Passive income (Real Estate) would allow the offset of your Ordinary Income / Short Term Cap Gains.