If there is absolutely 100% correlation between the class and operation of plan investments only, the IRS may find this to be acceptable in the event of an audit. 

I would be happy to hop on a call and go over everything if anyone is interested.

I am looking at a potential property that has an IRS lien associated with it. 

Do not just go for it, you want to learn about what you really want out of the investment before you hop in.

Finally, does the tax break benifit cross the boarder to Canada or do we have to leave 100% of our taxable net in the US and file our taxes with the IRS in order to qualify for the tax break.

After the loan is paid off, a 1099 is sent to the hard money borrower and the IRS showing the interest received.

I got a call today from a revenue officer with the IRS asking if I’d be interested in being a guaranteed bidder for a foreclosed property that the IRS has redemption rights to, due to a federal tax lien.

Here's where the rub comes: if you pay significantly less than what the home is worth, the IRS will consider the difference as a gift, which is taxable.

So, technically I made a profit of 7K on it.I am in a 30% tax bracket..So does it mean I will owe to the IRS roughly 30%  of that 7K?

We may transition to irs tax free 121 exchanges on primaries for an even better farm after this one reaches the 2 year mark of being our primary residence.