How do you take advantage of tax deductions on your business expenses when you don't have a business setup yet?

Deductions can only be made for actual damages (not wear and tear) caused by the tenant.Complaints against landlords are handled by the Attorney General's office. 

NON-RECOURSE OBLIGATIONS Note Holder agrees that for payment of this Note it will look solely to the Pledged Collateral or such other collateral, if any, it may now or hereafter be given to secure the payment of this Note, and no other assets of Borrower shall be subject to levy, execution or other enforcement procedure for the satisfaction of the remedies of Note Holder, or for any payment required to be made under this Note.

@Amy E.Check out the Landlord's Tax Deduction Guide by Nolo.

Remember, any out-of-pocket expense you accrue is tax deductible so long as you can show that the expense is related to your business (see LLC formation).  

You still have to collect on them.If they get paid cash for jobs then you will try to spend more money trying to force a garnishment or bank levy that will be in vain.

For homestead, they deduct that amount from the assessed value. 

Only the interest portion of your repayment is deductible as a business expense.  

Rather than building up the $1500 net profits every month, I'm thinking to just get a loan for the 12K and pay myself a bit less after deducting mortgage and construction loan payback.

In short, if you have a $10,000 claim for roof damage, expect a check in the amount of $2,500-$3,000 before deductible.