If you run a lending as business, your interest will convert to ordinary income and could be passive based on your involvement.

The one to four is a very comprehensive contract that covers everything and even has room for special provisions when something out of the ordinary needs to be spelled out.When doing not so normal purchases like a sub-to, I dont use the TREC, but one that I created from several other contracts.

Active = Income earned from Material Participation.Whether that's SMB, W-2, contract income, or prof real estate.This is income where ordinary tax is paid and losses offset other income.

For me I invest my SDIRA money in debt investments which typically are ordinary income when using w2 income and use my hard earned cash to buy properties. 

Greene.Tenants should be responsible for ordinary pest control.

Combine this with the deliberate targeting of unsophisticated investors or those without the resources to run ordinary diligence and you have a winning recipe.

Commercial appraisals are expensive, $5,000 isn't out of the ordinary.

I'm not a real estate professional in the IRS sense, so if I take money out of my real estate investments as profit, I'm paying ordinary income.

Therefore expect a 15 page home inspection report   filled with corrective measures you must satisfy otherwise the buyer walks.All in between turning over the home, ordinary transactional costs ( broker fees, transfer tax, loan payoff fees etc.) seller assist, repair addendum repairs its very possible for your exit fees to approach 13-15% of the properties sale price. 

But for me sets me back few years on my goal.I also think he lacks financial knowledge to see that something is out of ordinary and should not be used as basis for future returns (e.g. low interest rates of 2022 resulting in low cap rates).