I can eat outdoors at a restaurant probably 300 days a year listening to live music on the patio. 

Its knowing what to do with all your income and expenses and where it goes on the forms.If you've really wholesaled any properties, that's ordinary income. 

Moving on to your private patio and maintenance-free yard'...

Delinquent HOA assessment not paid by the foreclosed owner is a common problem that becomes the burden of the new Buyer, who has to settle with the HOA.Do the (sometimes) excessive HOA back dues increase the Cost Basis of the property that can be written off against ordinary gains or does it expense out (as passive income) on IRS Schedule E?

After you pay ordinary income tax on your $112,000 gain, you would have $410k - (30% of $112k) = $376,000If you can take that $376,000 and put 25% down on a large property (or multiple properties), you would control $1,504,000 worth of property. 

If the new owners wanted to build a 10k patio on it, the neighbor would have to pay to get it fixed if any future leaks /issues occurred.Being a  sewer line ( vs water line), that may be very different though!

But I did a walk through of the property, checked all the sinks and toilets, didn't see anything out of the ordinary, and I was going to have a plumber come and take a more careful look.I owned several triplexes and duplexes in the NYC area, and water bills for duplexes increased from $280.00/ 3-months 10 years ago, to $580/ 3-month on the last bills, and I thought of major leaks.

Or figure out how to boost sales in your business such that your income is high enough even with all those optional deductions.What you may not do is opt not to declare expenses that are usual and ordinary in the course of your business and which you actually incurred and paid, such as advertising, supplies, labor, rent, etc. 

Are you in a flood zone or something out of the ordinary?

If rentals, then you should definitely not mix it with AirBNB because it's normally taxed as ordinary income.