Knew a little but not a lot about this topic.With the fiscal cliff they are talking about taxing dividends at the ordinary income rate instead of the current capital gains rate.

Anyway, gimme a good multi unit with concrete patios any day!

VERY effective if done right. the problem is that most systems are squeezed by hand and not the ENTIRE crack is filled. a guy u used uses 3k PSI pressure to fill it in- dig on the outside and put tar, visqueen, dimpled membrane and fill dirt back in. very effective, very expensive (~8k in my area per wall). but you have driveways, patios... not always possible- hydraulic cement - not affective for the most part. sometimes it might work- sump pump inside the basement - french drain along the interior walls, pipes connect into a can, pumps it outside - very effective. around $5k per 1k sq. ft house.pumps can fail at times, but they cost around $125 to buy.- i have had great success with this one... pour a concrete slab like a patio on the outside. 99% of the water will be pushed away, so not enough water will get into the crack. the leak at my house stopped after pouring a patio. it used to leak during every rain.

Flipping houses is ordinary income and subject to your earned income tax rate.

Sample:"Nice 2 bedroom with laundry and patio.....    

Your not asking for anything out of the ordinary in my opinion.

Here's what I'm thinking so far:1) Add a bedroom to a section of the house that has currently windows and 3 walls (was previously used as a den) - this should be a relatively simple upgrade, permitting isn't bad in our county.2) Renovate bathrooms (2 full) - tiling, toilets, vanity.3) There may be a way to add another half bath off an adjacent room to turn into a mini-master bedroom. 4) Kitchen - upgrade counter, nice tile for flooring. 5) Add a deck off the back walk-out basement double door (it's about a foot drop to step out to the back patio).

@Cody SkidmoreThe book is a good book for real estate investors to open their eyes to think outside the box for potential deductions that you are entitled do.An expense must be ordinary and necessary for you to claim is as a deduction.With that said - The book was written several years ago and there was major changes to the tax code going forward.The "home office deduction" for employees is gone.

My tax basis for 2019 is $17,469 so I subtract that from my $20,000 profit to leave $2,531 of taxable (ordinary) income. 

Any ordinary and necessary expenses.