Long story short, not only did I commit the rookie mistake of paying for the remaining work in advance to the sum of $2.2k of which the work was never finished and no refund provided because of a sob story I won’t delve into.This gentleman was a foreigner who was legal and had a social security card for working purposes.

It doesn't make any sense to me why a s-corp shields FICA taxes in this instance and does not shield income for this purpose.

The safe harbor applies to amounts paid during the tax year to acquire or produce what the regs call a “unit of property” (UOP), you must meet these requirements: (1) at the beginning of the tax year, the taxpayer has written accounting procedures treating as an expense for non-tax purposes amounts paid for property costing less than a specified dollar amount (which will be 2500 for you), or with an economic useful life of 12 months or less;.(2) the taxpayer treats the amount paid for the property as an expense on its books and records in accordance with its accounting procedures. ( do this on your bookkeeping software or whatever you utilize)(3) the amount paid for the UOP doesn't exceed $2,500. as substantiated by the invoiceNote: The cost for the Unit of Property includes l additional costs (for example, delivery fees, installation services, or similar costs) if these additional costs are included on the same invoice with the tangible property.Eg:A purchases 100 printers at $500 each for a total cost of $500,000 as indicated by the invoice.

In your case, judging from the amount looks like you can deduct the cost of the rehab as expenses using de minims safe harbor rather than capitalizing and depreciating it.The safe harbor applies to amounts paid during the tax year to acquire or produce what the Regs call a “unit of property” (UOP), you must meet these requirements: (1) at the beginning of the tax year, the taxpayer has written accounting procedures treating as an expense for non-tax purposes amounts paid for property costing less than a specified dollar amount (which will be 2500 for you), or with an economic useful life of 12 months or less;

You also cannot pull your own permit once you intend to use the property for income purposes!

Your tax basis for federal income tax purposes is unaffected by claiming homestead exemption.  

For purposes of this definition, minors living with parent or legal guardian shall not be counted as part of the maximum number of residents.

It sounds cheesy, but start with your own personal purpose to getting licensed.

I'm soon will purchase a mortgage note, and for tax purposes and I think Self -direct IRA is a better choice for me and my wife.

@Andrew R.I have a strong preference for checkbook control, but I realize that comes at a cost for you (needing a special purpose LLC and having to pay annual fees to California since you are not Solo 401k eligible).