During the year of rental use, your net operating income was $10K which will be taxed as ordinary income at your marginal tax bracket rate. 

well turns out my needle in the haystack buyer just got the golden parachute from Precision die cast (retired CEO) he had been eyeballing it the whole time we were remodeling it.. we did a 1.5 million in finish work.. so you can imagine the quality and he wanted that home.. first day on market boom sold... and like any red blooded American broker day it closed I bought an airplane  LOL>.

@Cara LonsdaleGreat to hear of some other options/companies out there that offer warranties.One benefit to Homeserve that we found was that there's no deductible whereas for instance an American Home Shield has a $75 co-pay deductible for the folks to show up.However, on the downside there are a max number of calls/year (I think 2) per warranty category.

I think most people and my coworkers want to buy the "American dream" and it quickly becomes a nightmare once these kinds of issues start to pop up.        

Flipping is ordinary income and subject to self-employment taxes.

Here's the "special rule"https://constitution.laws.com/american-history/constitution/constitutional-amendments/27th-amendment

@Timothy Doenges  don't know on the bonus depreciation.. but remember you also have recapture.. so for me a new home builder.. its all ordinary income.. so its nothing I would spend any time on.I just look at it as a sales tool.. just like people in our area build green earth advantage homes..

Unfortunately this legislation has been held up in committee for over 15 years by politicians who care more about their personal interests than those of the American people so we have to continue waiting for real, meaningful tax reform.

Hi all,I am new to Bigger Pockets and the American Market ( I live in Europe - The Netherlands).

@Buddy Holmes, whether or not an assignment fee is a standard and ordinary cost of closing will be determined ultimately by what your acct. is comfortable with.