What are the tax ramifications of deciding not to rent a rental property and just leave it empty?

@Nicole TuffarelliI am aware of a few groups that can usually utilize funds from an IRA to help purchase new homes at reduced leverage (usually capped at 70% LTV).It might be more beneficial from a tax-standpoint as well to do it that way instead of drawing it all out.

How bad are the capital gains taxes?

Starting next month when my renter moves in i will have only utilities and taxes as overhead at my new home in michigan. 

Also property taxes were incredibly cheap at $500 / year (expected to go up in about 3 yrs). 

I understand the tax foreclosure and bank foreclosure before the REO but the HOA had me confused.

If you aren't a Real Estate Professional, I am not sure adding more to your portfolio, with the main intention being tax reduction, is the best option.

I have been driving for dollars and mining the county auditor's site for homeowners who are delinquent on their taxes.

If so, you can use the 121 exclusion and save on capital gains taxes to sell the home. 

Taxes on stocks held long enough are treated as capital gains.