@Justin Landesman's comments are critical about not funding without being on title and/or having a written contract about the distribution of profits.How much do you think the rehab budget is?

With foundation issues, one could have plumbing, drywall, flooring and even roof issues and alot more.

We run a background check to look for drug distribution charges and sex offenders3.

In a partnership it does. (2) if you distribute property from an S Corp, you will have to pay taxes even if it's to yourself. 

There are actually THREE kinds of subject to transactions1- subject to existing mortgage without lender approval2- subject to existing mortgage WITH lender approval3- subject to existing mortgage as part of a seller financed wrap around mortgage.with #1 and #3 it’s in everyone’s interest to utilize a third party servicer, who collects and then distributes payments.  

@Rud SevHere is a start:https://www.biggerpockets.com/forums/51/topics/839015-are-sy...https://www.biggerpockets.com/forums/51-tax-legal-issues-con...

Specific technical issue that triggered this post.

Any paused distributions?

Also, the whole point of hiring a PM is to handle tenant, maintenance, and rent collection, so if your partner isn’t actively managing but just supervising the PM, IMO not worth having a two people essentially looking over the same tasks.Contributing financially for one person and the other having no financial stake raises decision making questions, such as when to sell, how profits will be distributed, etc.

When the tenant moves out and the funds are distributed either to the tenant or the landlord for damages, then the subaccount for that specific tenant has a zero balance and that subaccount is closed.