To me that is a huge reason why I continue to strive to become a Sophisticated Investor.Thank you so much for your response! 

@Dave - Looks like salary/payroll is on the P&L so chances are there is a PT employee maintaining the place. 

@Daniel LiuFirst - you got bad advice to own rental properties inside of an S-corp.Second - If the property manager is considered an employee(look at the definition of an employee vs independent contractor and the caselaw that surrounds this topic) to determine how this person should be paid.If he is an employee, you need to file payroll tax returns, remit withholding payments to the IRS/State, file W-2 forms, etcGood luck!

Chris Meunier sophisticated investors look at return on equity.

Hi Steve,  If you're paying your kids as Household Employees, this is not set up to work in quite the same way as the method I outlined above, which is more of a traditional payroll scenario.If you're filing Schedule H for Household Employees on your return and reporting your kids there, then you're paying the social security and medicare there and then the amount just becomes part of your overall tax bill.However, you are supposed to give your kids a W-2. 

I may do a 1031 exchange but the capital gains rates are low right now and I can most likely make money with some of the cash and use some for some capital improvement projects as I am mainly mortgage free at this point.The income that is not subject to SE taxes might be subject to SE taxes via payroll requirement if you run this transaction in your S-corp.

Other markets where your sellers are more sophisticated and the real estate more stable this becomes low volume type of deal..

Make sure the tenant uses their own materials and is not assigned to do the job on a particular day - this can blur the line between "independent contractor" and "employee", which could affect things like you having to pay payroll taxes or workman's comp. 

Most ppl who buy these products are educated upper middle class or higher so they are either much more sophisticated (or should be) or have access to folks like RIA's CPA's CFP's etc because they get it!

We also offer a limited listing for $500 for 6 months to our sophisticated sellers, but that's largely just a way to try to help stimulate more inventory to market and hopefully a way to get the jump on properties for our buyer clients.