And while the IRS wants income taxes, they want employment taxes (SS, Medicare) much more.Thanks,Jason

They were both self employed running their own businesses and treated RE as a investment but not a business.

[Note: There is a caveat here: if the corporation employs 5 or more full-time positions, then the income would be classified as "active" and would be taxed accordingly].When rental property is held by an individual, the net passive income (or loss) is added to that individuals other income and taxed at the corresponding marginal tax rate.

Buying small rentals is self-employment.  

The employer that provides the training derives no immediate advantage from the activities of the trainees, and on occasion the employer’s operations may actually be impeded; 5.

Hey Brian Hoyt, this is kinda not what you're asking, but you mentioned rehabbing them...a former employer used to buy and sell RV's as a hobby/side business.

But, I'd be lying if I said that my poker winnings didn't somewhat contribute to things like our ability to become self-employed, our kids' college funds, etc.The important thing to remember -- and that a lot of kids who jumped into online poker the past few years -- is that playing poker for a living is nothing more than just another job.

Jeff, The issue I am facing with is due to the amount of time it will take to roll the funds from my existing ex-employer's 401k plan to a new solo-401k plan which I was hoping to use to fund this property.To give you an example, let's say this property is contracted for 300K.Let's say I have one IRA account with TDAmeritrade say with 100K, Schwab with 100K and a 401K plan with JP Morgan with 500K.Previously I had inquired with TDAmeritrade, Schwab, and JP Morgan and they all told me all it takes to roll over to another IRA provider is 3-5 days. 

I appreciate you making this point and think this doesn't get talked about enough, especially for self-employed people.  

If someone has income, employment history, good credit, no criminal record and gives me a deposit for the property it is entirely up to them what they do with the property within their lease.