Don't necessarily rule out agents that haven't or are a new agent as long as your aren't also new.

Rule one, the person with the gold makes the rules. 

Typically its no Issue untIl you have to do an evictIon or when cIty fInds out.https://www.citybuildingowners.com/rules-for-new-york-city-basement-rentals/Read the article should have the details you are looking for..

Is it allowed from IRS rules?

@Robert ReineriAlso, certain distribution rules apply to solo 401k plan so you may not be able to take a distribution from the solo 401k plan unless you meet a distribution triggering event. 

@Linda MalavetThere is a special rule regarding taxation and collecting rent payments.Rent payments are normally taxed in the year collected.Therefore - I am not sure what the tax difference would be from having a 35 month lease vs a 36 month lease.

After you spent more money on repairs and improvements your cash on cash return may still be below 10%.Now compare this number with the opportunity of passive investing with a pool of other investors into the apartment building or commercial real estate.  

I wouldn't rule out single families in the area if you know how to execute that strategy.

I am making a list of "Safety rules" for tenants to get their acknowledgment via DocuSign  before the winter :)))

Using the 50% rule to estimate expenses, would the estimated cashflow be $283?