Their income met our criteria at the time but they didn't have long enough employment history.

The tenant has been basically past due since Dec due to employment hours being reduced (that's their story).

Lots of employment and population growth due to weather and there are many affordable cities.

In Baltimore City, the things that keep neighborhoods from falling apart are major employers like Hopkins (Hospital and Unjversity), MICA, Mercy, Stratford etc. they have sweetheart deals with the city, whereby they keep on expanding their footprint and improving the neighborhoods where they’re located.  

Especially considering I am self-employed so I may look more risky.Another thing to note is that I have a good friend who is a real estate agent and investor as well with 5 properties in LA and he is helping me out with this.

Was you employer matching any of your contributions?   

You sell for $300k, and your $45k profit is taxed as ordinary business income, plus self-employment tax.As you can see, it is the worst possible result for you, which is why the IRS would go there. :)I can see room for some creative tax planning here, but it would not fit in a short online post.

The larger employers during the Great Recession did not really scale back much.

If you're self-employed, the Solo 401k will likely be the better fit for you.Here are few Solo 401k benefits:Compared to an IRA, Solo 401k contributions limits are roughly ten times higher.There is no custodial requirement for the 401k.You can take participant loans from the plan.You don't need the additional expense and administration of an LLC to have checkbook control.There is a built in-Roth component whereas IRAs are either traditional or Roth, not both.A spouse can also participate in the same Solo 401k plan.The Solo 401k has additional tax benefits over an IRA when investing into real estate using leverage.If you're not self-employed or if you have a business with employees, the self-directed IRA will be your main option.

Often employed by professional tenants to mislead mom and pop landlords.For me it is a obvious red flag when screening.