And then using what's left to payoff probably relatively low interest loan that you have on your rental and loosing interest write off deduction doesn't sound like a wise financial move...Why don't you consider setting up a self-directed IRA, moving your Vanguard IRA in there and then invest passively in trust deeds (or some other alternative assets).

I plan on also doing a credit check / background check after I receive the application back from prospective tenants.Heres the link: http://www.nj.gov/treasury/dpmc/Assets/Files/Renta...Also - do you guys usually charge application fees?

Investing in commercial is definitely the way to go, because you have more control of the asset value in the long run.

Most of the lenders who offer those can offer a release clause that allow you to sell or kick out one asset without redoing the loan. 

Assuming this is just a plain vanilla rental, it should not be subject to self-employment tax, and it belongs on Schedule E, not Schedule C, where it sounds like your tax software is currently putting it. 

Hello,I'm looking for advice on what entity structure is best for real estate investors to protect their assets. 

For anyone with fewer than 15 - 20 units, I don't think paid software is even necessary.

Sometimes sellers don't know they owe as much as they do, and will walk away (since they can still rent the asset).

Interesting strategy, and in spite of my debt-averse nature I am simply curious about how they make it work.No cash flow, or very little.Let's say no maintenance at first and self-managers get to keep the management fee, leaving $150/month ($1,800/year) profit on a $50,000 asset.

Having some asset (like medical offices) “back your investment” is a little different than wanting to be a silent partner in the local dry cleaning or boutique smoothie joint.