@Jack B.Certainly a question for your cpa/accountant since we don't know your full financial picture..But, no, you aren't taxed twice, once as a capital gain and then again as ordinary income. 

Maintain a personal reserve that enables you to handle ordinary maintenance and emergency repairs.How much reserve should you have? 

Result is I claimed 15,000 depreciation which when I sell, i have to pay tax at ordinary income tax rate.If i do not claim "active participation", then the 25,000 will be carried forward as "suspended loss", and if i sell my property next year, the 15,000 depreciation that was not used can work to reduce my depreciation recapture income / tax. 

The income from the flip is ordinary income.

Screened in patio was redneck so fixed that up to how it should be.

Townhome 2 bed 1 and 1/2 bath , two story. 955 sqft has a decent little fenced patio/yard section.Price $225k5% down rate around 7.95%Will be my primary residence, Austin Tx, area is decent, breweries, food trailers, close to shopping center, and soccer stadium.The residence isnt terrible just needs a few things, kitchen appliances, remove carpet for plank vinyl.I know it won't cash flow right out the gate , I can maintain the monthly note and have a 6 month emergency fund.

The interest you are earning from investing (mortgage lending) is taxable (worst yet, I believe it is taxed as ordinary income).If the seller is not paying any principal, this really doesn't minimize your capital gain tax bill over time.

The lease terms are typically about 2x market rent for an ordinary SFH and the leases are typically 3-5 years in length so they provide much more stability and less vacancy overall.

The primary bedroom leads out to the covered patio and beautiful backyard .

As others mention they will pay tax (ordinary income rates) on the interest payments only and once they exceed their cost basis they will also pay tax on whatever is above the basis.