To have a population trapped in employment that they don't like, doing jobs they don't like or that conflict with their values - all because they have to pay the mortgage is a way to pacify even the most independently minded population.There will be winners out of sub-prime and it won't generally be the ordinary citizen!

There may even be a tax benefit to changing the character of ordinary income to passive income.

However, you can only apply this "passive loss" vs. ordinary income if you are a "real estate professional".

Insurance, advertising, tenant screening, legal fees, maintenance, evictions, the list goes on.If the net taxable income is negative (entirely possible with the depreciation) you may be able to deduct this against your ordinary income.

And, its taxable income for you, though at the dividend rate rather than the ordinary income rate.

So it's taxed at your ordinary income rate.all cash

You would need to hold the property for some period, probably a year plus.If you're planing to just turn around and sell this quickly, its either short term capital gains or ordinary income.

The assignment fee is ordinary income, so its taxable at whatever your marginal rate is.

Any income from wholesaling is going to be subject to either ordinary income or short term capital gains.

Bush has not objected when the big firms and rich executives of Wall Street have been on the receiving end of federal assistance, but now he is threatening to block a measure to aid hard-hit neighborhoods filled with ordinary Americans.I think its an ugly situation that these two entities have been structured so any rewards go to the shareholders and especially executives and risks get moved to the taxpayers.