I purchased the property and fixed it up all in cash, but in order to finance it to get my investment back, I believe I'll need to wait the minimum settle time which is ~6 months. 

The people and content here are amazing.I would like to share with everyone a milestone reached yesterday: Closing on 1st Fix and Flip/HoldI am humbled and very grateful to all who have helped and showed supported along the way. 

Here's my question: Could my expenses to fix up the house (it needs a lot) be used to offset the Penalty and tax I will generate from using this IRA?

Owner would therefore face a large capital gains penalty upon selling the asset.Would it be possible/legal to execute a master lease option with a buyout that is intended to outlive the seller such that they can have fixed income for the remainder of their life, and such that their children can receive stepped basis by inheriting the asset that is already under contract (which was obviously written to be binding upon successor's and heirs).

Here's my question: Could my expenses to fix up the house (it needs a lot) be used to offset the Penalty and tax I will generate from using this IRA?

By planting these fixed seeds that are and continue to pay dividend, it stabilized my income flows and concurrently allowed me to build up reserves for additional purchases. 

We closed on our first deal, a fix and flip in Summerfield, NC, at the end of July and are currently doing renovations.

from someone who likes fixing things?

But I agree fix the issues at hand, do some cosmetic upgrades (paint floor lighting kitchen and bath) and should be able to sell it for a profit

In today's economy it's better to either own apartment complexes (which don't require any experience) , Fix and Flips, or Quick Flips.I do believe that real estate property ownership is a game of quantities and how many offers you make will effect your success.