According to the IRS you can get nailed for doing as little as changing a lightbulb and I definitely don't want to push the envelope. 

Ellis San Jose nailed it.

@Steven Gesis  Man you nailed it.  

there is a reason judgments sell for 5 cents on the dollar  Greg hit the nail on the head.I used to go to all that trouble... but then they file BK and you get a letter from the trustee instructing you to give all the money you collected back to the BK court..So your actually out the money you collected and the fee's you paid to collect.I have a good friend that owns a company that buys judgments nationwide for 1 to 5 cents on the dollar.. the ONLY way they collect is they let them season  IE to right at 9.5 years  most judgments are good for 10 years.. then they do the skip trace and garnishments the debtor had usually completely forgotten about the judgment and has new bank accounts ext.. these guys are really good at what they do but it is an expertise that the average landlord just is wasting time try to perfect a judgment.

.), I always look under the carpet to see if the hardwood floors are intact (i.e no one has nailed plywood over them) and whether they can be refinished.I figure tenants (or buyers) can always use an area rug, or wear slippers, if they want something warmer underfoot.

Anyway, we are looking at older houses in lower income neighborhoods so we are aware that there will be things that have to be repaired, but paying for a complete inspection every time we make an offer could real expensive, real fast if we have to withdraw because of a big issue - like the entire floor of the house, including the joists, is sitting directly on the ground and is completely rotted and full of fungus!

I can't say what that is but you probably nailed it in your example.  

My next step is to nail down additional costs to clean up some of my initial estimates and determining the finance solution.

Wear such as granule loss, exposed fiberglass, biogrowth, nail pops, and/or buckling shingles was observed.

Hotels, motels, gas stations, grocery stores, and nail salons have to pay their taxes, so the short-term rental operators should do the same.