I enjoy receiving the 8-12% monthly and quarterly pref. dividends but all is taxed on ordinary income.

I currently live in California.Yes, Muncie has some problems, but nothing well out of the ordinary for mid-sized cities surrounding Indianapolis.    

This is likely an unrealistic example but it demonstrates how selling your interest in the LLP can affect you tax wise.When you sell an interest in a LLP, you may have to recognize ordinary income regardless of how long you have held the units.

Here is a summary of what I have gleaned:Building Attributes: one level, ground floor, elevator in multistory buildings, no steps, universal design, wider doorways, smooth floor coverings without throw rugs, chair height toilets, hand rails, grab bars, bathroom near bedroom, laundry in unit or close by, good lighting, less square footage to take care of but enough to comfortably move around and to entertain visitors, close to bus stops, close to medical facilities, close to activities that interest seniors, garden, front porches, backyard patios/decks, quiet, warm, safe.Landlord Attributes: respectful, attentive, face-to-face communication, willing to adjust speaking speed and volume as needed, willing to do things for tenants to keep them off ladders and step stools (change light bulbs, hang pictures, etc.), willing to adjust policies and procedures to accommodate needs (alternative ways to pay rent, use of telephone instead of texting, etc), genuine interest in seniors' wisdom and legacy, willing to check in on the safety and well being of residents, willing to assume responsibility for yard work, snow removal, and keeping outside pathways clear of debris, willing to help tenants connect with community services as the need arises (cleaning help, food prep programs, senior services, etc.), service oriented.

or is it Ordinary income.

Delachaise on St Charles uptown is another cool spot to relax with cool patio outside.

When/If you sell you do pay depreciation recapture- this is NOT at LT capital gains rates, It's actually at ordinary income tax rates (but caps at 25%). 

The bit of good news is that while the tax on unrecaptured depreciation is at your ordinary rate that rate is capped at 25%. 

If you haven’t had it for a year -long term capital gains will not be in effect if you sold it already you will pay ordinary income on profit above the basis in your property. 

IE you have 1 bedroom of 3, then 1/3 of these indirect costs would be personal in nature, the rest business.One additional (major) item to keep in mind is that the short term nature of Air BnBs can be more akin to a motel/hotel (ordinary income), and not 'rental' income - ordinary meaning it could be subject to Self Employment tax if you end up showing a profit.