It's a matter of understanding the rules for not being hands on, no sweat equity work.I understand the tax issues.

When I look back it's funny, it cost me about $6K and my sweat to learn something I have come across many times in the forums, podcasts, and blogs in just one week.

Yeah you can probably find the part at a wholesale AC supply and change it yourself but at what price.This is based on my experiences with several AC repairs I did myself.1. 30 mins to 1 hr researching ( self diagnosing) the part online, calling to find who has it in stock2. 1 hr round trip to buy the part3. 1 hr of sweating in the sun or baking in the attic while disassembling the unit.4. 30 mins to install and test the system. ( hopefully I was correct with he diagnosis from step 1or else we start all over)5. 30 more minutes of sweating and baking to reassemble everything.So if the part was $60 and an AC company charges $140 I saved $80.

. :-) I was looking for a way to use a self directed plan for down payment(s) to help get me started and be able to make some non IRA/401K income from my sweat equity.

I have yet to hit that low in my return but I have also put more sweat equity then most do.

The total tax bite will be greater than capital gains taxes.For your share of the participation, you are contribuing materials and sweat equity. 

Being new and out of state you won't be able to ad any sweat equity to the deal so naturally capital would be the only other thing you could put into it.I would look into becoming a realtor in NYC.

I can understand how a flip may work well between a sweat partner and a money partner.

As long as resident pays on time and that always is case because I hired a great RE agent that does my screening and I buy in solid A/B areas, I dont sweat it.

Tenant moves out, have a month of vacancy, I don't sweat it because the funds are in my RMVITC accounts.